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Pradhan Mantri Garib Kalyan Yojana 2016 (PMGKY)

The Lok Sabha has passed the PMGKY (Second Amendment) Bill, 2016 in the Lok Sabha. The Bill was introduced as some of the existing provisions of the Income Tax Act, 1961 can possibly be misused for concealing black money. The new bill attempts to impose a higher rate of tax and penalty in respect of undisclosed incomes.

If we are willing to declare the unaccounted income under the new Pradhan Mandri Garib Kalyan Yojana is very easy and to that you need to follow three steps are mentioned by the bills passed in the Taxation Laws Bill which was declared in the second amendment in the year 2016. It is not possible for the people who have already made the money through the illegal ways.

Three steps are,

  1. Declaring about the deposits and Cash– The declaration should be made as per the amount that one is having which may be accounted or unaccounted. The deposits should be made in RBI or in any other recognized bank.
  2. Pay taxes and make the deposit-The person is compelled to pay 25% of the total declared amount into PMGKY 2016. The deposit that the people is making will be blocked for time span of 4 years and after that it will be given back without any interest to it.
  3. Declaration should be made with payment and deposit proof– The declaration will be submitted with proper evidence. After such procedure, if one is found to have the unaccounted money with they then or she will be charged with higher tax.

Information regarding the Taxation and Investment Regime for PMGKY 2016:

I. The penalty that is imposed on the general provision:

——>Tax of 200% for misreporting

——->50% of tax for under-reporting

——->Income and assessed income is the normal difference between misreporting or under-reporting income

II. The penalty that is imposed on the provisions for taxation and unexplained credit, investment cash.

——> 30% will be charged flat + surcharge+ cess

——->No expense, deduction set-off is allowed