New Tax Rates on undisclosed income in India -Taxation Bill 2016

CA Satbir Singh — Wed, 30 Nov 2016 04:47:58 +0000

NEW TAX RATES ON UNDISCLOSED INCOME

Lok Sabha Passed Bill to Tax Black Money / Undisclosed Income on 29.11.2016 . This Bill is called The Taxation Laws (Second Amendment) Bill, 2016 .

Overview of this bill:

Tax Rates on Undisclosed Income As per Taxation Laws (Second Amendment) Bill 2016 passed by Lok Sabha on 29.11.2016

Income Declared	Explanation of Tax Rate and Deductions	Effective Tax Rate
Income declared under Pradhan Mantri Garib Kalyan Yojana, 2016	Flat rate of tax @30% of Income u/s 199D(1) + Penalty @10% of income declared u/s 199E + surcharge to be called Pradhan Mantri Garib Kalyan Cess @33 % of tax u/s 199D(2) Conditions :- 1.declaration in respect of any income, in the form of cash or deposit in an account maintained by the person with a specified entity. Read Pradhan Mantri Garib Kalyan Yojana, 2016 2.No expense, deductions, set-off is allowed 3. 25% of income declared to be deposited in interest free Deposit Scheme for 4 years	49.90%
Unexplained Income is disclosed voluntarily in Income Tax Return	Flat rate of tax @60% of Income u/s Section 115BBE + surcharge @ 15% of Income ( i.e @25% of tax ) u/s Section 115BBE + 3% Education Cess on Tax and Surcharge u/s Section 115BBE (No expense, deductions, set-off is allowed)	77.25%
Unexplained Income is disclosed voluntarily in ITR but advance tax is not paid on or before 31.03.2017	Flat rate of tax @60% of Income u/s Section 115BBE + surcharge @ 15% of Income ( i.e @25% of tax ) u/s Section 115BBE +10% Penalty on Tax u/s Provio to Section 271AAC + 3% Education Cess on Tax and Surcharge u/s u/s Section 115BBE (No expense, deductions, set-off is allowed)	83.25%
Income is disclosed in ITR but treated as unexplained by Tax Officer	Flat rate of tax @60% of Income u/s Section 115BBE + surcharge @ 15% of Income ( i.e @25% of tax ) u/s Section 115BBE +10% Penalty on Tax u/s Section 271AAC + 3% Education Cess on Tax and Surcharge u/s u/s Section 115BBE (No expense, deductions, set-off is allowed)	83.25%
Income admitted after search and declared in ITR	Flat rate of tax @60% of Income u/s Section 115BBE + surcharge @ 15% of Income ( i.e @25% of tax ) u/s Section 115BBE + Penalty u/s 271AAB @ 30% of income + 3% Education Cess on Tax and Surcharge u/s Section 115BBE (No expense, deductions, set-off is allowed)	107.25%
Income not admitted after search and/or not declared in ITR	Flat rate of tax @60% of Income u/s Section 115BBE + surcharge @ 15% of Income ( i.e @25% of tax ) u/s Section 115BBE + Penalty u/s (271AAB) 60% of income + + 3% Education Cess on Tax and Surcharge u/s Section 115BBE (No expense, deductions, set-off is allowed)	137.25%

* Penalty is computed on tax amount excluding cess and surcharge

Tax Table

1 Income declared under Pradhan Mantri Garib Kalyan Yojana, 2016

Income Range	Income-tax	Garib Kalyan Cess	Penalty	Deposit for 4 years	Total Deductions	Total Tax & Penalty
Income Range	Under Sec. 199D(1)	Under Sec. 199D(2)	Under Sec. 199E	Under Sec. 199F		(at 49.9%)
200,000	60,000	19,800	20,000	50,000	149,800	99,800
500,000	150,000	49,500	50,000	125,000	374,500	249,500
1,000,000	300,000	99,000	100,000	250,000	749,000	499,000
2,500,000	750,000	247,500	250,000	625,000	1,872,500	1,247,500
5,000,000	1,500,000	495,000	500,000	1,250,000	3,745,000	2,495,000
7,500,000	2,250,000	742,500	750,000	1,875,000	5,617,500	3,742,500
10,000,000	3,000,000	990,000	1,000,000	2,500,000	7,490,000	4,990,000
20,000,000	6,000,000	1,980,000	2,000,000	5,000,000	14,980,000	9,980,000
50,000,000	15,000,000	4,950,000	5,000,000	12,500,000	37,450,000	24,950,000

A. Income-tax	30%
B. Garib Kalyan Cess	33% of Tax (9.9%)
C. Penalty	10% of undisclosed income
D. Deposit for 4 years	25% of undisclosed income

2 Unexplained Income is disclosed voluntarily in ITR and advance tax is paid on or before March 31, 2017

Income Range	Income-tax	Surcharge	Education Cess	S&H Education Cess	Total Tax & Penalty
Income Range	Under Sec. 115BBE				(at 77.25%)
200,000	120,000	30,000	3,000	1,500	154,500
500,000	300,000	75,000	7,500	3,750	386,250
1,000,000	600,000	150,000	15,000	7,500	772,500
2,500,000	1,500,000	375,000	37,500	18,750	1,931,250
5,000,000	3,000,000	750,000	75,000	37,500	3,862,500
7,500,000	4,500,000	1,125,000	112,500	56,250	5,793,750
10,000,000	6,000,000	1,500,000	150,000	75,000	7,725,000
20,000,000	12,000,000	3,000,000	300,000	150,000	15,450,000
50,000,000	30,000,000	7,500,000	750,000	375,000	38,625,000

A. Income-tax	60%
B. Surcharge	25% of Income-tax (15%)
C. Education Ces	2% of Income-tax & Surcharge
D. S&H Education Cess	1% of Income-tax & Surcharge

3 Unexplained Income is disclosed voluntarily in ITR but advance tax is not paid on or before March 31, 2017

Income Range	Income-tax	Surcharge	Education Cess	S&H Education Cess	Penalty	Total Tax & Penalty
Income Range	Under Sec. 115BBE				Under Sec. 271AAC	(at 83.25%)
200,000	120,000	30,000	3,000	1,500	12,000	166,500
500,000	300,000	75,000	7,500	3,750	30,000	416,250
1,000,000	600,000	150,000	15,000	7,500	60,000	832,500
2,500,000	1,500,000	375,000	37,500	18,750	150,000	2,081,250
5,000,000	3,000,000	750,000	75,000	37,500	300,000	4,162,500
7,500,000	4,500,000	1,125,000	112,500	56,250	450,000	6,243,750
10,000,000	6,000,000	1,500,000	150,000	75,000	600,000	8,325,000
20,000,000	12,000,000	3,000,000	300,000	150,000	1,200,000	16,650,000
50,000,000	30,000,000	7,500,000	750,000	375,000	3,000,000	41,625,000

A. Income-tax	60%
B. Surcharge	25% of Income-tax (15%)
C. Education Ces	2% of Income-tax & Surcharge
D. S&H Education Cess	1% of Income-tax & Surcharge
E. Penalty	10% of Income-tax (6%)

4 Income is disclosed in ITR but treated as unexplained by Tax Officer

Income Range	Income-tax	Surcharge	Education Cess	S&H Education Cess	Penalty	Total Tax & Penalty
Income Range	Under Sec. 115BBE				Under Sec. 271AAC	(at 83.25%)
200,000	120,000	30,000	3,000	1,500	12,000	166,500
500,000	300,000	75,000	7,500	3,750	30,000	416,250
1,000,000	600,000	150,000	15,000	7,500	60,000	832,500
2,500,000	1,500,000	375,000	37,500	18,750	150,000	2,081,250
5,000,000	3,000,000	750,000	75,000	37,500	300,000	4,162,500
7,500,000	4,500,000	1,125,000	112,500	56,250	450,000	6,243,750
10,000,000	6,000,000	1,500,000	150,000	75,000	600,000	8,325,000
20,000,000	12,000,000	3,000,000	300,000	150,000	1,200,000	16,650,000
50,000,000	30,000,000	7,500,000	750,000	375,000	3,000,000	41,625,000

A. Income-tax	60%
B. Surcharge	25% of Income-tax (15%)
C. Education Ces	2% of Income-tax & Surcharge
D. S&H Education Cess	1% of Income-tax & Surcharge
E. Penalty	10% of Income-tax (6%)

5 Income is admitted after search and declared in ITR

Income Range	Income-tax	Surcharge	Education Cess	S&H Education Cess	Penalty	Total Tax & Penalty
	Under Sec. 115BBE				Under Sec. 271AAB	(at 107.25%)
200,000	120,000	30,000	3,000	1,500	60,000	214,500
500,000	300,000	75,000	7,500	3,750	150,000	536,250
1,000,000	600,000	150,000	15,000	7,500	300,000	1,072,500
2,500,000	1,500,000	375,000	37,500	18,750	750,000	2,681,250
5,000,000	3,000,000	750,000	75,000	37,500	1,500,000	5,362,500
7,500,000	4,500,000	1,125,000	112,500	56,250	2,250,000	8,043,750
10,000,000	6,000,000	1,500,000	150,000	75,000	3,000,000	10,725,000
20,000,000	12,000,000	3,000,000	300,000	150,000	6,000,000	21,450,000
50,000,000	30,000,000	7,500,000	750,000	375,000	15,000,000	53,625,000

A. Income-tax	60%
B. Surcharge	25% of Income-tax (15%)
C. Education Ces	2% of Income-tax & Surcharge
D. S&H Education Cess	1% of Income-tax & Surcharge
E. Penalty	30% of Undisclosed Income

6 Income not admitted after search and/or not declared in ITR

Income Range	Income-tax	Surcharge	Education Cess	S&H Education Cess	Penalty	Total Tax & Penalty
Income Range	Under Sec. 115BBE				Under Sec. 271AAB	(at 137.25%)
200,000	120,000	30,000	3,000	1,500	120,000	274,500
500,000	300,000	75,000	7,500	3,750	300,000	686,250
1,000,000	600,000	150,000	15,000	7,500	600,000	1,372,500
2,500,000	1,500,000	375,000	37,500	18,750	1,500,000	3,431,250
5,000,000	3,000,000	750,000	75,000	37,500	3,000,000	6,862,500
7,500,000	4,500,000	1,125,000	112,500	56,250	4,500,000	10,293,750
10,000,000	6,000,000	1,500,000	150,000	75,000	6,000,000	13,725,000
20,000,000	12,000,000	3,000,000	300,000	150,000	12,000,000	27,450,000
50,000,000	30,000,000	7,500,000	750,000	375,000	30,000,000	68,625,000

A. Income-tax	60%
B. Surcharge	25% of Income-tax (15%)
C. Education Ces	2% of Income-tax & Surcharge
D. S&H Education Cess	1% of Income-tax & Surcharge
E. Penalty	60% of Undisclosed Income

Taxation and Investment Regime for Pradhan Mantri Garib Kalyan Yojana 2016
The Taxation Laws (Second Amendment) Bill, 2016 introduced in Lok Sabha 28.11.2016

New Taxation Bill to tax undisclosed income introduced in Lok Sabha by India -PMGKY -Govt Press Release 28.11.2016

Tax Rates as per Taxation Bill 2016 Archives - Tax Heal