TAX ON UNDISCLOSED OLD CURRENCY NOTES DEPOSITED IN BANK
Tax Rate under Section 115BBE for Undisclosed Monies (Section 69A) deposited in the Bank and shown in the Tax returns has been increased from 30% to 60% via The Taxation Law (Second Amendment) Bill, 2016.
A surcharge of 25% of the Tax amount determined u/s 115BBE i. e. 15% of the Undisclosed Monies deposited in Bank shall be payable in addition to the 60% Tax.
Further the Penalties have also been increased substantially for Tax Evaders.
In order to provide an Emnesty to the holders of Undisclosed Monies, the government has introduced ‘Pradhan Mantri Garib Kalyan Yojna’ (PMGKY) under which an assessee can deposit following amounts:-
1. Tax – 30% of Amount Disclosed
2. Surcharge – 10% of Amount Disclosed
3. Penalty – 10% of Amount Disclosed
4. Deposit (Interest Free with 4 Yrs Lock-In) – 25% of Amount Disclosed.
The disclosures in PMGKY scheme will ensure that no questions will be asked about the source of fund. It would ensure immunity from wealth tax, civil laws and other taxation laws. But there is no immunity from FEMA, PMLA, Narcotics, and black money act.
It is critical for any person holding any Undisclosed Monies to seriously consider the Emnesty under PMGKY as the government has very clearly established it’s Intent and the consequences have also been clearly spelled.