Golden chance to declare domestic black money at effective tax rate of 31%

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Customer Care No. 91-11-45562222
Golden chance to declare domestic black money at
effective tax rate of 31
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• The Govt. has given an opportunity to persons who
  have not paid full taxes on their income of
  earlier years to come forward and declare the
  undisclosed income under the 'Income Declaration
  Scheme' (IDS). They are required to pay tax of
  forty-five per cent of such undisclosed income.
  The IDS is effective from June 1, 2016 and will
  remain open up to September 30, 2016. The
  declarant is required to pay tax up to November
  30, 2016.
• However, various queries have been received by
  CBDT on IDS. Thus, the CBDT had issued three sets
  of FAQs till date. In the recent tranche of FAQs
  issued on June 30, 2016 the CBDT has clarified
  that once the person had declared undisclosed
  income, no question will be asked from where such
  income or tax is coming from. This assurance in
  the lasts FAQs (Question 5) issued by dept. will
  bring down the effective tax rate from 45 to 31
  on the undisclosed income. Let us understand this
  scenario with the help of illustration.

Customer Care No. 91-11-45562222
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• Suppose Mr. A offers his undisclosed income of
  Rs. 290 crores under IDS. Now out of Rs. 290
  crores he will declare his undisclosed income of
  Rs. 200 crores by paying tax of Rs. 90 crores
  (Rs. 200 crores 45). As per the clarification
  no questions will be asked from where such income
  of Rs. 200 crores has come. Similarly, the
  remaining income of 90 crores (290-200) from
  which he has paid taxes will also be treated as
  his legitimate income. Thus, ultimately Mr. A has
  paid tax of around 31 on undisclosed income of
  Rs. 290 crores.
• The dept. had also clarified that such
  information will not be shared with other law
  enforcement agencies. Thus, it is the golden
  opportunity for taxpayers to come clean by paying
  effective tax rate of 31.

Customer Care No. 91-11-45562222
www.taxmann.com
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Customer Care No. 91-11-45562222
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