Pradhan Mantri Garib Kalyan Yojana (PMGKY)
If you are willing to declare the unaccounted income under the new Pradhan Mantri Garib Yojana is very easy and to that you need to follow three steps and these 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. Now, to prevent these amounts they are trying to hide it for their benefits but with the change in currencies these people came in to serious problems and they had to come out with the unaccounted amount but they are charged with serious taxation policies.
Steps to Pradhan Mantri Garib Kalyan Yojana
The people with the accounted money are supposed to show the reason based on which they have extracted the amounts. Therefore to continue the process their amount needs to be accounted into the Pradhan Mantri Garib Kalyan Yojana. These steps are mentioned in the points given below:
- 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 the Reserve Bank of India or in any other recognized bank. Then this amount will be collected by the bank and it will be transferred for modification into new notes.
- Pay taxes and make the deposit – the person suppose to pay the tax of 30% on the income apart from that he or she has to pay 33% as the surcharge tax and 10% penalty on the overall income. This will total to almost 50% of the total income will collected for the government fund. The person is also compelled to pay 25% of the total declared amount into Pradhan Mantri Garib Kalyan Yojana 2016. The deposit that the people is making will be blocked for time span of four years and after that it will be given back without any interest to it.
- Declaration should be made with payment and deposit proof – After fulfilling the above steps, it becomes essential for the people to file a form and then he or she should verify it using the rules and regulation prescribed by the government. The declaration will also 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.
Taxation policies to those who will declare
If one is disclosing the entire amount that he has undisclosed so far in front of the government then he or she is liable to pay taxation and investment regime for Pradhan Mantri Garib Kalyan Yojana 2016. In which he or she is suppose to pay 30% of the undisclosed amount and penalty as the 10% of undisclosed amount and apart from all these he or she has to pay 33% taxation for the Pradhan Mantri Garib Kalyan Cess’. This could total up to 50% of the total balance.
If one is not declaring the undisclosed amount
In case if someone is holding the undisclosed amount and he or she is not declaring it then there is a chance of getting caught during the investigation. If someone is caught to have the undeclared amount then he or she is liable to pay flat 605 on the total amount and apart from that he or she should pay 25% (15%) tax for surcharge which may account up to 75% of the total amount and after that 10% will be charged as penalty.
Therefore if you are trying to hide the undisclosed amount then you may have to be paying for more than 75% of the total amount that you are trying to hide.
Quick glance at the table
Take a quick glance at the table as it will explain the necessary information regarding the Taxation and Investment Regime for Pradhan Mantri Garib Kalyan Yojana. 2016’
|PARTICULARS||EXISTING PROVISIONS||PROPOSED PROVISIONS|
|The penalty that is imposed on the general provision||Penalty (Section 270A)||No changes are proposed|
|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|
|The penalty that is imposed on the provisions for taxation and unexplained credit, investment cash.||Tax (Section 115BBE)||Tax (Section 115BBE)|
|30% will be charged flat + surcharge + cess||60% flat rate + surcharge 25% tax. (15% of the unaccounted income) total 75% tax (approx)|
|No expense, deduction set-off is allowed||No expense, deduction set-off is allowed|
The taxation polices in the year 2016 has made a revolution and the people with lot of unaccounted money has to suffer for it. The decision is a Step towards the development of the nation and equal distribution of income among every people of this nation.
After the implementation of demonetization, the central government announced another scheme that gave people with black money a chance to come forward. The name of this scheme is Pradhan Mantri Garib Kalyan Yojana. But recently, the central authorities instructed government employees not to divulge any details about the PMGKY. This scheme states that in case black money holders come forward, and disclose their holding, they will be able to get respite, after paying 30% tax, 33% surcharge and 10% penalty. Non-disclosure of information will help the central government to monitor the implementation of PMGKY, and bring the axe down on the perpetrators.