NICAI UPDATES

1. An amendment in the Black Money Act will give taxpayers relief from penalty in case they fail to disclose overseas assets worth Rs 20 lakh, however the obligation to report the transaction is not done away with. The Black Money Act amendments in Section 42 and 43 will be a part of the Finance Bill.

2. Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015 aims to curb black money, or undisclosed foreign assets and income and imposes tax and penalty on such income. Currently under the Act, even if the taxpayers fail to disclose a foreign asset worth Rs 5 lakh, they have to pay a Rs 10 lakh penalty on it.

3. At present if the taxpayer is holding any asset abroad, which is not declared in the income tax return then there is a penalty of Rs 10 lakh. An amendment in the Black Money Act is proposed that If the value of the overseas asset is up to Rs 20 lakh, and is not disclosed, there will be no penalty if it's a bonafide mistake on the part of the taxpayer.

 4. Budget 2024 proposes an amendment to Section 206C of the Income-tax Act, addressing concerns from entities with tax-exempt income facing difficulties with tax collected at source (TCS) on their transactions.  

5. The new amendment, effective from October 1, 2024, will enable the Central Government to notify specific persons, institutions, or classes of entities for whom TCS may be either exempted or applied at a reduced rate. This provision aims to alleviate the tax burden on organizations that are not required to file income tax returns due to their exempt status, thereby simplifying compliance and reducing undue financial strain.