The government has allowed people declaring unaccounted cash under the new black money amnesty scheme PMGKY to deposit in parts the mandatory 25 per cent of the total in a 4-year fund by March 31.
Offering one last chance to black money holders, the government has given them time until March end to come clean by paying 50 per cent tax on bank deposits of junk currencies made post demonetisation.
Under the Pradhan Mantri Garib Kalyan Yojana (PMGKY), declarants also have to park a quarter of the total sum in a non-interest bearing deposit scheme (PMGKDS) for four years.
“The Government has decided to allow declarants to make deposits on one or more occasions in the Pradhan Mantri Garib Kalyan Deposit Scheme (PMGKDS), 2016,” said a statement by the Finance Ministry.
As per the scheme, taxes will have to be paid first and then the scheme can be availed of on production of tax receipt, unlike the recent Income Disclosure Scheme and other such plans wherein disclosures were made first and taxes were recovered later.
The PMGKY scheme commenced on December 17 and will remain open for declarations up to March 31. The scheme is part of The Taxation Laws (Second Amendment) Act, 2016, which was approved by the Lok Sabha on November 29.
Also, as the disclosures will be kept confidential, the holder of unaccounted cash need not disclose it in Income Tax Returns forms.
After the shock November 8 demonetisation announcement, the government allowed the junked Rs 500 and Rs 1000 notes to be deposited in bank accounts.
For those depositing unaccounted cash, the government offered the tax evasion amnesty scheme wherein 50 per cent tax will be charged on declarations and quarter of the total sum be parked in a non-interest bearing deposit for four years.
Non declaration of undisclosed cash or deposit under the Scheme will render such undisclosed income liable to tax, surcharge and cess totalling to 77.25 per cent of such income if it is declared in the income tax returns.
In case the same is not shown in the return of income a further penalty of 10 per cent of tax shall also be levied followed by prosecution.