Government has notified the rules for calculating overseas income and assets under the foreign black money law that came into effect on July 1.
The value of the overseas assets, including immovable property, jewellery and precious stones, archaeological collections and paintings, shares and securities and shares in unlisted firms abroad will be calculated at the fair market value, the rules notified by the CBDT said on Friday.
The value of an overseas bank account will be the sum of all deposits made in the account since its opening, the rules said.
The Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015, provides for a total of tax and penalty of 120% on the income or assets held abroad after the expiry of a one-time 90-day 'compliance window' provided for persons to come clean.
Any income or asset declared during this period which ends on September 30, would attract a total of 60% tax and penalty, without penal provisions like jail term. They will have time till December 31 to pay the levies.
The rules notified on Friday provide for the way foreign income and assets would be valued for calculation of tax and penalty both for the compliance period and beyond its expiry.
The fair market value of an immovable property will be higher from the acquisition cost or the price that the property shall fetch in open market on the date of valuation.
The same principle would also be applicable for valuing bullion, jewellery or precious stone as well as archaeological collections, drawings, paintings and sculptures or work of art.
For valuing shares and securities of listed entities, the rules said the fair market value will be the higher of the cost of acquisition or average of the lowest and highest price on the date of valuation.
The rules also provided a formula for calculating the fair market value of an unquoted equity shares and provided a methodology for calculating the interest of a person in a partnership firm, association of persons or Limited Liability Partnership (LLP).
The rules also contain seven forms including those which have to be filled by persons while declaring the undisclosed assets outside the country.
The holders of the assets will have to disclose details of the location of bank accounts, date of opening and sum of all credits in the prescribed format.
Similarly they have to make disclosures with regard to immovable property, artistic works, securities held or any other assets along with their fair market value.
With regard to jewellery, disclosures have to be made about the purity, quantum and value of gold, diamond and other precious metals.
The rules said the Reserve Bank's reference rate on the date of valuation should be used for converting the value of foreign assets and income into Indian rupee.
Where the fair market value of an asset is determined in a currency other than one of the permitted currencies designated by the RBI, they should be converted into US dollars on the date of valuation as per the rate specified by the central bank of that country. Thereafter, the value in dollar would be converted into rupee.
The rules also provide for the format of notices to be send to the persons holding undisclosed assets. Also the format for appeals to Commissioner (Appeals) and Appellate Tribunal have been provided.