Wednesday, February 15, 2017

Pradhan Mantri Garib Kalyan Yojana (PMGKY-2016)

Clarifications on the Taxation and Investment Regime for PMGKY, 2016 
The undisclosed income deposited in the accounts with Post Office/Banks can be declared under the Scheme.
  • The Scheme is not available for declaration of an income which is represented in the form of assets like jewellery, stock or immovable property.
  • Deposits made by any mode such as cash, cheque, RTGS, NEFT, or any electronic transfer systems are eligible.
  • Where a notice under section 142(1)/ 143(2)/ 148/ 153A/ 153C of the Income-tax Act has been issued to a person for an assessment year, even such person be eligible for making a declaration under the Scheme.
  • Even a person against whom a search/ survey operation has been initiated can file declaration under the Scheme. The cash seized and deposit with Bank/Financial Institution during search operation can be declared under the scheme in the form of cash or deposit in an account maintained by specified entity.
  • No credit for advance tax paid, TDS or TCS shall be allowed under the Scheme.
  • Undisclosed income represented in the form of deposits in foreign bank account is not eligible for the scheme.
  • Deposits made in bank account prior to financial year 2016-17 can also be declared under the Scheme.
  • Undisclosed deposits between 01.04.2016 to 15.12.2016 shall also attract tax at the rate provided in the Taxation Laws (Second Amendment) Act, 2016.
  • Undisclosed income deposited/repaid in an Overdraft Account or Cash Credit Account or any loan account maintained with a bank is eligible for being declared under the Scheme.
  • The adjustment of cash seized by the Department and deposited in the Public Deposit Account may be allowed to be adjusted for making payment of tax, surcharge and penalty under the Scheme on the request of the person from whom the cash is seized. However, the said amount shall not be allowed to be adjusted for making deposits under the Pradhan Mantri Garib Kalyan Deposit Scheme.
  • Cash deposited in third party account can also be declared under the scheme.                         Brownfield (100%) - Automatic upto 74%, Government route beyond 74% 

Explanatory Notes on- PMGKY, 2016 
  • A declaration under the aforesaid Scheme may be made in respect of any income in the form of cash or deposit in an account maintained by the person with a specified entity, chargeable to tax under the Income-tax Act for any assessment year commencing on or before the 1st day of April, 2017.
  • No deduction in respect of any expenditure or allowance or set-off any loss. 
  • 30% Tax, 33% of tax as surcharge, 10% of undisclosed income penalty & 25% of undisclosed income as 4 year interest free deposit under the scheme.

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