Post demonetization of the currency on 8 November 2016, a scheme namely, ‘Taxation and Investment Regime for Pradhan Mantri Garib Kalyan Yojana, 2016’ (‘the Scheme) was introduced by the Taxation Laws (Second Amendment) Act, 2016 which came into force on 15 December, 2016.
The Scheme came into effect on 17 December, 2016 and will be ending on 31st March, 2017. Thus, declarant has time till 31st March, 2017 to declare his undisclosed income.
The Scheme provides an opportunity to persons who have not paid full taxes in the past to come forward and declare the undisclosed income and pay tax, surcharge and penalty totaling in all 50% of such undisclosed income declared. Besides, declarant is required to mandatorily deposit 25% of the undisclosed income in Pradhan Mantri Garib Kalyan Deposit Scheme, 2016. Deposit shall not bear any interest and has a lock in period of 4 years.
Payment for tax, penalty, surcharge and deposit shall be made before filing of declaration under this Scheme
Declaration can be made in respect of undisclosed income in the form of cash or deposits in an account with bank or post office.
Our newsflash captures the key aspects of the Scheme.