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Income Tax Return New Guidelines: Now if the Income Tax raids your place and you honestly disclose your undeclared income, then tax will be levied at a maximum rate of 60 percent. Now if a raid is conducted, accounts will be taxed at the rate of 60 percent for six years in block assessment. Interest levied under Section 234(A), 234(B) and Section 234(C) will not be levied on it. The penalty levied under Section 270 will also not be levied. Tax will have to be paid at the rate of 60 percent only on accounts of six years i.e. unaccounted income or hidden income. Union Minister Nirmala Sitharaman has introduced this provision through the presented budget of 2024-25.
Waiver of interest and penalty
There will be a full waiver of interest and penalty on the taxable amount of 60% of the gross income for six years. Taxpayers who have been raided will be directed to re-file returns for six years. The taxpayer has to declare all unaccounted income in this return. If the taxpayer declares the entire unaccounted income, the case will be dismissed by levying income tax at the rate of 60 per cent. Of course, the taxpayer will have to pay income tax at the rate of 60 per cent on the total income for six years.
30% penalty on wrong returns after raid
But if the entire unaccounted income is not shown in the return, then 60 per cent tax plus 30 per cent penalty will have to be paid. Thus 90 per cent of the total income has to be paid as tax. After the raid, the taxpayer will be asked to file a new return. Suppose, in the new return, the taxpayer's six-year income is increased by Rs. 10 crore, then income tax at the rate of 60 per cent will have to be paid on it. There will be no interest or penalty on this. But if the assessment officer examines the new six-year return filed by the taxpayer and finds that the taxpayer has to pay tax on an income of Rs. 15 crore, then the taxpayer's undisclosed income of Rs. If it is found to be 15 crore, then 60 per cent tax will have to be paid on the difference of income of Rs. 5 crore, in addition to the penalty. A penalty of 50 per cent will also have to be paid on this.
However, the way for appeal against this fresh assessment has been kept open. If a new assessment is done, the old assessment will be completely rejected. The new assessment will be considered final and tax will be levied. Under the current system, if reassessment was going on for six years, then in such a situation, notice was issued for the year which had a duration of twelve months. Now, assessment of all six years will be done together.
Now you will not get any notice regarding returns every year
The system of giving notice in respect of one year's return has been abolished. The tax assessing officer will examine the return of six years i.e. the return of total income. Speaking on the provision of direct tax, the committee drafting the Income Tax Act, it has been decided to apply section 158 (BD) if someone else's money, jewellery, gold or other property is found in the taxpayer's house during the raid. In the budget under the initiative of Gujarat Chamber of Commerce and Industries, member Girish Ahuja said. He says that for this reason only a period of twelve months has been fixed from the date of completion of the raid.
Nirmala Sitharaman has also introduced a provision in the Budget 2024-25 to assess and recover the tax due on you within a period of twelve months after the month of the raid date. Along with this, the process of inquiry and notice under Section 148 (A) has been removed. In this, the assessment officer inquires, then explains the reason, then asks the taxpayer to file a return, then gives you an opportunity to represent and then takes a decision and gives an order. This process has been removed. Subsection 1 of Article 148 states that no one will re-assess it.
If the Assessing Officer feels that your income is more, he will issue you a notice. If additional income is found in the assessment, the officer will issue a notice to the taxpayer. He will also ask the taxpayer about the additional income that he has discovered. The arguments given by the taxpayer in this regard will be heard. After this, he will take his decision and also give an order. Whether tax has been evaded or not. This order will be made under subsection 3 of order 148 (A). After passing the order, notice of 148 will be given and then section 147 will be applied. Reassessment will now be for five years instead of six years.