The four-month window for declaring domestic blackmoney will open on June 1 and those opting to come clean by paying 45 per cent tax and penalty will not be subject to scrutiny and enquiry by tax department.
The Income Declaration Scheme 2016 will remain in force till September 30 for filing of declarations and payments towards taxes, surcharge and penalty must be made latest by November 30, the Finance Ministry said in a release.
"No scrutiny and enquiry under the Income-tax Act or the Wealth tax Act (no abolished) shall be undertaken in respect of such declarations.
"Immunity from prosecution under the Income-tax Act and Wealth Tax Act is also provided along with immunity from the Benami Transactions (Prohibition) Act, 1988 subject to transfer of asset to actual owner within the period specified in the Rules," it said.
The scheme was announced by Finance Minister Arun Jaitley in the Budget with an aim to fish out black money from the domestic economy. Earlier, the government had come out with similar scheme for Indian holding undisclosed income abroad.
The scheme will apply to undisclosed income whether in the form of investment in assets or otherwise, pertaining to Financial Year 2015-16 or earlier, the Ministry said.
"Under the Scheme, income as declared by the eligible persons, would be taxed at the rate of 30 per cent plus a 'Krishi Kalyan Cess' of 25 per cent on the taxes payable and a penalty at the rate of 25 per cent of the taxes payable, thereby totalling to 45 per cent of the income declared under the scheme," the Ministry said.
Declarations can be filed online or with the jurisdictional Principal Commissioners of Income-tax.
Giving details, the Ministry said that where the declaration is in the form of investment in assets, the 'Fair Market Value' of such asset as on June 2016 shall be deemed to be the undisclosed income under the Scheme.
However, foreign assets or income to which the Black Money Act 2015 applies are not eligible for declaration under this scheme.
Assets specified in the declaration will be exempt from Wealth tax.
Non-payment of total taxes, surcharge and penalty in time or declaration by misrepresentation or suppression of facts shall render the declaration void.
"Non-declaration of undisclosed income under the Scheme, will render such undisclosed income liable to tax in the previous year in which it is detected by the Income tax Department. Other penal consequences will also follow accordingly," the Ministry said.
It also said that the relevant rules and forms for the scheme will to be notified shortly.