HIGHLIGHT ON BLACK MONEY BILL

SALIENT FEATURES OF THE BLACK MONEY BILL

Untitled15AThe Black Money (Undisclosed Foreign Income and Assets) And Imposition of Tax Bill, 2015, popularly known as Black Money Bill passed by both the Houses of Parliament, requires all Indians to declare undisclosed foreign assets and income. This bill will be effective from 01.04.2016. It is expected that compliance window could be open for 2-3 months to declare undisclosed income and assets. A further six months could be provided to make tax payments.

Here are the salient features of the Black Money Bill:-

  • Tax on all undisclosed foreign income will have to be paid at the flat rate of 30 per cent without any exemption, deduction, set off or carry forward losses that the Income Tax Act permits.
  • Tax on all undisclosed foreign income will have to be paid at the flat rate of 30 per cent without any exemption, deduction, set off or carry forward losses that the Income Tax Act permits.
  • Enhanced punishment of jail for 3-10 years for willful evasion of tax on foreign income along with a penalty equal to three times the amount of tax evaded or 90 per cent of the undisclosed income or the value of the asset.
  • There is a limited compliance window offer. Offenders would have to pay tax at the rate of 30 per cent but concessional penalty would be equal to the tax amount. I.e. 30%.
  • Failure to file returns of foreign income or assets will attract a penalty of Rs. 10 lakh.
  • New law will not cover those having amounts equivalent to Rs 5 lakhs in bank accounts abroad, which may belong to students or those working there.
  • The compliance window will give an opportunity for payment of tax and penalty, “once the compliance window closes, people are going to be taxed very heavily.
  • Tax and penalty of 120 per cent (30% TAX and 90% PENALTY), which will be imposed after the expiry of ‘compliance window’, means the value of assets is gone.
  • It will apply only to resident and will not cover Non-Resident Indians (NRIs) working abroad. Those who work abroad are not going to be covered. It is those who are resident taxpayers and assessesed in India, and who keep unauthorized income outside are going to be liable under this Act.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances; Hope the information will assist you in your Professional endeavors. For query or help, contact: info@carajput.com or call at 09555555480.

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