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  • MODERATOR:

    Hello and welcome to the webchat with Preeti Khurana, chief editor, ClearTax on the new Income Tax Act proposals



  • A

    ANAND

    Can an amount in the fixed deposit account of a nationalised bank deposited prior to 8.11.2016 also be declared under the PM Yojana? We’re assuming that the person is ready to pre-maturely withdraw the fixed deposit to pay applicable taxes and the compulsory deposit of 25%. Further, will the value for declaration of FD be the face value (principal) or face value + interest accrued as on date of declaration?

    PREETI KHURANA

    Yes, any deposits held with a bank can also be disclosed under the PM Garib Kalyan Scheme, 2016, assuming this deposit is from an income which was not disclosed earlier. Yes, pls declare full value including interest, since this total shall be the undisclosed amount.


  • K

    KARUN

    Hi Preeti, Thanks for giving an opportunity to interact with you. I have 3 points to make: 1. How significantly the new norms would encourage people to declare their black money? 2. What is the expected realization from this proposal? 3. Can law enforcement agencies mandate tax authorities to declare the source of income?

    PREETI KHURANA

    Hi Karun, PMGKY seems to be a last and final opportunity for those who want to put things in order. At 50% tax + penalty incidence on self declaration, this is not too way off from IDS, 2016. Therefore, I believe people who want to declare and bring books to order for future as well, must use this opportunity. Its hard to tell what the total collection will amount to, but IDS is expected to collect Rs 30,000 cr and the figure from PMGKY is likely to be more.


  • P

    PRANAY KUMAR

    I am a salaried individual earning around Rs 25 lakh a year. Over the past few years, I have made withdrawals amounting to around Rs 7 lakh per annum from my salary account. In the demonetisation drive, I deposited Rs 15 lakh that I saved from my withdrawals over the years. 1) What are the chances of my getting an Income Tax notice? 2) How can I bext explain the amount deposited? 3) What is the percentage in case I am asked to pay tax on the amount deposited? Thanks

    PREETI KHURANA

    Hi, you must prepare to explain these deposits to the tax department as you are likely to be asked about the nature and source of them. Anyone who is making cash deposits shall have provide details on the income tax department website about whether this is already included in their tax return or not. You can login and check this from the tax department website. Try this link https://blog.cleartax.in/tax-department-tracking-500rs-1000rs-currency-deposits/ Do you have copies of bank statements where you can explain these withdrawals and their purpose? In case you are not able to satisfactorily explain these deposits and do not opt for PMGKY, 2016, your tax liability can go upto 85%.


  • R

    RASHMI RANJAN

    Will my PPF deposit in cash be taxed / come under scrutiny? I can establish the source of income

    PREETI KHURANA

    Deposits made in PPF in cash in the past or during this year shall not be subject to scrutiny. Unless aggregate deposits made by you from 9th November to 30th December in all your bank accounts or term deposits exceeds Rs 2.5L.


  • A

    ANSHUL

    With the new I-T act amendments, do you think centre will succeed in getting the black money out?

    PREETI KHURANA

    Due to demonetisation, this scheme is expected to be successful. It is time for businesses and households to go digital and bring their books of accounts to order.


  • A

    AKASH

    What is the incentive for black money holders to deposit money under the new scheme

    PREETI KHURANA

    This seems to be the last option for anyone who is hoping to bring their taxes and books of accounts in order. And atleast recover some portion of their cash without fear.


  • A

    ASHUTOSH TIWARI

    How can households with genuine savings save themselves from the tax radar under the new I-T Act amendment? Will the Act help or harass them?

    PREETI KHURANA

    Any cash deposits made should be explainable. If these are household savings one must be able to fully support and explain them, that these are nothing but income which is already reported and tax paid on it. If you are making deposits in excess of Rs 2.5L between 9th Nov and 30th Dec, you must prepare to fully support them.


  • S

    SAPNA GUPTA

    Wouldn't have it made sense to launch the demonetisation and IDS together for better tax compliance? Because black money hoarders have anyway turned their money white with help of touts.

    PREETI KHURANA

    The tax department has offered many options in the past for taxpayers to come clean. The PM Garib Kalyan Yojana, 2016 is almost like a disclosure scheme,where hoarders can come clean and deposit tax+penalty of max 50% (IDS was at 45% tax + penalty). This way they can have 25% of the money available to them immediately.


  • A

    AKSHAY

    What will happen to depositors, who have deposit money in excess of Rs 10 lakh or more? There may be cases where the tax payer has paid taxes and has not filed ITRs for past few years?

    PREETI KHURANA

    Any deposits made must be fully explainable. You should be fine if you have paid taxes on this income and you can fully explain the source of this income. You can still file returns of FY 2015-16 and FY 2014-15 on www.cleartax.com. So try and file what you can and make sure you have proper documentation to explain.


  • A

    AASHISH

    If the govt collect enough money from the new IT act amendments, will this eventually help in lowering tax rates for common man?

    PREETI KHURANA

    Tax rates depend upon a lot of factors. You are right that tax collections are likely to spurt this year, however, tax rates are an ongoing levy. They depend upon total revenue status of the government, it can also have social objectives. Govt needs money to fund projects or to invest in infrastructure. Higher revenues can help keep fiscal deficit in check. So, there are many factors at play.


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