Persons who have assets and income or bank accounts abroad will get three months to declare them. The Ministry of Finance has set September 30 to reveal assets abroad and December 31 to pay the tax on the declared assets and income abroad.
The three month timeline for declaring black income and six months time period for paying the tax are introduced as compliance window of the newly enacted Undisclosed Foreign Income and Assets and Imposition of Tax Act 2015.
Earlier, the Parliament has ratified a 30 per cent tax and 100 percent penalty tax rate (total 60 per cent tax) on declared black income in foreign countries under the black money act that is aimed at black money parked overseas.
All income and assets holders who doesn’t uses the compliance window to reveal income and to pay taxes will get the prosecution, criminal procedure, imprisonment and have to pay 120% tax.
The compliance window is a one time opportunity available for black income and asset holders to reveal their money stored abroad and convert into white money by paying the penalty taxes. No prosecution is made against the income revealing people who use the compliance window, whatever may be the source of their black income.
Globally, many countries are coming out with anti black money bills and many of them have amnesty clauses similar to India’s compliance windows.