Don't file 'drastically' revised income tax returns, warns Central Board of Direct Taxes
- As per the new scheme instead of maximum 30% tax on revised ITR now the taxpayer will have to pay 50% tax.
- This came after reports claimed that taxpayers are filing revised ITR to pass off unaccounted for money as income.
- As per law, one can file revised ITR only on the occasion of omission or filing of wrong statement.
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Planning to file revised income tax returns? Think again as the Central Board of Direct Taxes (CBDT) has sent out a warning that those who are filing 'drastically' revised income tax returns after the demonetisation to include their bank deposits will be facing penal action.
What will be the penal action? Instead of maximum 30% tax on revised filing as per earlier rule now the taxpayer will have to pay 50% tax says the new scheme.
The department had to come up with this schemes after various reports claimed that many people after currency ban are filing revised income tax returns for this year to accommodate their hoarded money and show it as income of last year.
CBDT said, "The provision... has been stipulated for revising any omission or wrong statement made in the original return of income and not for resorting to make changes in the income initially declared so as to drastically alter the form, substance and quantum of the earlier disclosed income.”
CBDT also confirmed that in the case of IT department sees manipulation in income in income tax return of last year; scrutiny will be conducted on such taxpayers.
Also READ: Income Tax bill: 5 changes that will hit black money hoarders
The IT act allows a taxpayer to file revised income tax return in omission or wrong statement has been filed.
But, since demonetisation, many people are misusing this provision to pass off their unaccounted for money as previous year's income.
