Our hon’ble Finance Minister Mr. Arun Jaitley, in his Union Budget for the year 2016-17, came with a new scheme to deal firmly with the Tax Evaders. The scheme was named as “Income Declaration Scheme 2016” incorporated as Chapter IX of the Finance Act 2016 will be effective from 01st June 2016.
This is the One-time opportunity or a limited period compliance window for all the taxpayers to come forward and declare all of their undisclosed income pertaining to financial year 2015-16 or earlier years and clean up their past tax violations by paying more than the Normal Tax.
The salient features of Income Declaration Scheme 2016 are as follows:
- Declaration can be made in respect of any Income in the form of assets or otherwise which have not been declared, intentionally or unintentionally in the past years.
- Tax shall be payable @45% of the undisclosed income comprises of normal tax @30%, surcharge @7.5% and penalty @7.5%.
- Income can be declared from 01st June 2016 to 30th September 2016 and taxes can be paid by 30th November 2016.
- No Scrutiny or Enquiry or Prosecutions shall be made in respect of such declarations under Income Tax Act & Wealth Tax Act. Also the assessee will get immunity from Benami Transactions (Prohibition) Act, 1988 (subject to certain conditions).
- The declaration shall be made in FORM 1 which has been duly notified. The form can be filed online at gov.in or offline to Jurisdictional officer of Income Tax.
- No declaration can be made in case a notice u/s 142, 143(2), 148, 153A, 153C of IT Act has been issued or search u/s 132 has been conducted or survey u/s 133A has been carried out or cases covered under Black Money (Undisclosed Foreign Income & Assets) and Imposition of Tax Act, 2015.
IDS, 2016 is definitely proved to be a beneficial scheme for the eligible tax payers to declare the undisclosed income as compared to various sections viz.271, 276C 270A of the I.T. Act, 2016 or various income declaration schemes announced for taxpayers to declare unaccounted money during the past decades.
This time, our Government is leaving no stones unturned in making a Income Declaration Scheme 2016, a success. Also, our Prime Minister Narendra Modi, in his very famous Radio Programme “Mann ki Baat”, said that “We lose our peace by violating rules. Why we should not give correct information about our income and assets to the government and get free from it?”
Contributed by CA Garima Goyal
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