The government on Wednesday set September 30 deadline for declaring undisclosed foreign income and assets to avoid hefty fines and a jail term under the new black money law.
People who avail the one-time ‘compliance window’ of three months would have to pay a tax of 30% on the value of declared assets and a penalty of a similar amount by December 31.
“The last date by which a person must pay the tax and penalty in respect of the undisclosed foreign assets so declared shall be the December 31, 2015,” a finance ministry statement said.
The Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015, which Parliament passed recently, would come into force from April 1, 2016.
Under the law, Indians would be required to pay 120% tax if they found to have not disclosed foreign assets after the compliance window closes on September 30.
Besides, such persons would also face criminal prosecution with a jail term of up to 10 years.
“The act provides for separate taxation of undisclosed foreign income and assets. Stringent penalties and prosecution, including rigorous imprisonment up to 10 years and penalty equal to three times of the tax have been prescribed for violation,” the statement added.
The window has been notified keeping in mind the discussions between the Central Board of Direct Taxes and the special investigation team on black money. The SIT had suggested that people be given a chance to voluntarily disclose hidden foreign assets and bring them into the legitimate financial system.
In October, the government had handed over to the Supreme Court a list of 628 names that were on a list of HSBC account holders in Geneva handed over to India by France in 2011.
India has also offered a “cash reward” to Herve Falciani, a former HSBC bank employee-turned-whistleblower, for securing fresh information on unaccounted money parked in foreign bank accounts.
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