Tax dept not to take action on cash deposits made after declaring income under IDS

NEW DELHI: The government has said no adverse action will be taken by Financial Intelligence Unit or the income-tax department solely on the basis of the information regarding cash deposit made consequent to the declaration under the black money scheme.

Credit for unclaimed tax deducted at source made on declared income shall be allowed and no capital gains tax or TDS (tax deducted at source) shall be levied on transfer of declared benami property from benamidar to the declarant without consideration.

To reassure people about the Income Declaration Scheme, 2016, which will close on September 30, the Central Board of Direct Taxes has come out with sixth set of clarifications in form of frequently asked questions.

It has again assured those wanting to declare unaccounted assets or income that information in respect of a valid declaration would be confidential and not be shared with any law enforcement agency nor shall be enquired into by the income-tax department itself.

The scheme provides an opportunity to persons who have not paid full taxes in the past to come forward and declare their undisclosed income and assets. The scheme came into effect on June 1, 2016 and is open for declarations up to September 30, 2016.

A total tax of 45 per cent including surcharge and penalty has to be paid.

The amount payable under the scheme can be deposited in instalments. As per the latest clarification, assets declared under the scheme are to be valued at cost of acquisition or at fair market price as on June 1, 2016 as determined by the registered valuer, whichever is higher.

However, an option for valuation of registered immovable property on the basis of stamp duty value of acquisition adjusted with the Cost Inflation Index has also been provided.

The amount of fictitious liabilities recorded in audited balance sheet and not linked to acquisition of an asset can be disclosed under the scheme as such. The period of holding of declared registered immovable assets shall be taken on the basis of the actual date of registration.

The valuation report obtained by the declarant from a registered valuer shall not be questioned by the department. However, the valuer’s accountability will remain, it said.