The Central Government had notified that 31st January 2020 as the Last date for payment under IDS 2016

The Central Government had notified 31st January 2020 as the last date for payment of pending amount as per the Income Declaration Scheme (IDS) 2016.

While exercising the powers that has been conferred by the provision towards sub-section (1) of section 187 of the Finance Act, 2016 (28 of 2016), the Central Government had specified that the individuals who has made a declaration under sub-section (1) of section 183, however, has not made payment of the tax as well as surcharge payable under section 184 and fine payable under section 185 of the stated Act, relating to the undisclosed income, on or before the due date that has been notified by the Central Government by means of a notification number S.O. 1830 (E), which was made on 19th May 2016, (as consequently amended through notification number S.O. 2476 (E), which was made on the 20th July 2016), might make the payment of such amount on or before the 31st January 2020, together with the interest on such amount, at the rate of 1% for every month or part of a month included in the period beginning on the date immediately following the specified due date as so informed and ending on the date of such payment.
This notification would be considered to have come into force with effect from the 1st day of June 2016.

Explanatory Memorandum—it has been certified that no individual is being adversely affected by means of giving retrospective effect towards this notification.

What is Income Declaration Scheme?

Income Declaration Scheme

In the Budget 2016-17, there was a limited proposal towards gathering tax by means of Tax Compliance Window for domestic taxpayers, so that they could disclose any undeclared proceeds of the earlier years. The provision recognized as the Income Declaration Scheme which is presently a part Finance Bill, 2016. The scheme provides an opportunity toward everyone for coming out with any wrongly accumulated income in the previous years or those who didn’t pay the tax correctly in the previous years or those who have any undeclared assets in any form. The scheme had stayed useful for a 4-month period. The declaration has been submitted from 1st June 2016 onwards until 4 months.

Who could disclose income and assets under the Income Declaration Scheme 2016 (TIDS)?

The citizens who had not declared they are earning wholly or partially and paid their taxes in full in the past could appear and declare their undisclosed income or assets. Accordingly, they are required to pay the corresponding taxes, surcharges, as well as fines as applicable. Thus each and every citizen which includes individuals, HUFs, companies, firms, and association of people could be able to disclose income and assets under the Income Declaration Scheme, 2016 (TIDS).

Income tax penalty rate

An individual is required to pay a penalty according to the rates mentioned below;

•    Income tax at the rate of 30% of undisclosed income.

•    Surcharge at the rate of 7.5% of undisclosed income.

•    Fine at the rate of 7.5% of undisclosed income.

A total of 45% of the undisclosed income is needed to be paid towards the government.

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eStartIndia Team