The Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015 was introduced to address a long-standing concern—unreported income and assets held outside India. The Act targets individuals and entities who hide wealth abroad to evade taxes, and it does so with strict penalties, high taxes, and even imprisonment.
Unlike regular income tax provisions, this law is far more stringent. It applies retrospectively to undisclosed foreign assets and places the responsibility of proof squarely on the taxpayer. In short, if you hold overseas assets, disclosure is not optional—it’s mandatory.
While undisclosed assets attract severe penalties, compliant investments offer peace of mind. A Bajaj Finance Fixed Deposit helps you grow your money transparently with assured returns and zero compliance stress. Book FD.
Provisions of the Black Money Act
The Act lays down a strict framework to identify, tax, and penalise undisclosed foreign income and assets. Its key provisions include:
- Scope and Applicability – Targets undisclosed foreign income and assets of Indian residents.
- Flat Tax Rate – Imposes a straight 30% tax on unreported foreign assets or income.
- Penalties – Additional penalties can go up to 90% of the tax payable.
- Criminal Prosecution – Willful evasion may lead to imprisonment of up to 10 years.
- One-Time Compliance Opportunity – Allowed voluntary disclosure earlier with a 60% total levy (tax + penalty).
- Burden of Proof – Unlike the Income Tax Act, the taxpayer must prove asset legitimacy.
- Applicability to Beneficial Owners – Even indirect ownership or interest is covered.
- International Cooperation – Enables information exchange with foreign tax authorities.
- Audit and Investigation Powers – Grants wide powers to tax authorities for inspection and recovery.
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