Tax Amnesty Schemes
Tax Amnesty Schemes are various resolution schemes to settle tax disputes or to settle tax litigation. Tax Amnesty schemes provided by Government under various names such as Vivad se Vishwas Scheme 2020
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Income Tax being in the nature of revenue law, always has high number of litigation between the revenue authorities and the tax payer. Government want to expedite the litigation process in order to reduce cost on litigation and speedily resolution for taxation matters, also generate timely revenue for the Governments.
For reducing long pending litigations and providing tax relief measures, the Government provide tax amnesty schemes, recently in its Union Budget 2020 has come up with DIRECT TAX VIVAD SE VISHWAS SCHEME, commonly abbreviated as VSV Scheme 2020.
Laws and Regulations pertaining to tax amnesty schemes in the name of Vivad se Vishwas Scheme 2020:
- Direct Tax Vivad se Vishwas Act 2020 effective on and from 17th day of March 2020
- Direct Tax Vivad se Vishwas Rules 2020 inserted vide Notification number S.O. 1129(E), dated 18-03-2020
- Circular Number 07/2020, F.No. IT(A)/1/2020-TPL issued on dated 04-03-2020. This circular is regarding clarification on Direct Tax Vivad se Vishwas Bill 2020 in the form of FAQs.
- Circular Number 09/2020, F.No. IT(A)/1/2020-TPL issued on dated 22-04-2020. This circular is regarding clarificatory provisions on Circular number 07/2020
Procedural compliance for tax amnesty schemes in the name of Vivad se Vishwas Scheme
- Filing of Declaration in Form-1
The applicant need to file declaration electronically on the portal of Income tax in Form-1 regarding the litigation (appeal) to be settled along-with nature and quantum involved in the appeal.
- Filing of Undertaking in Form-2
The applicant needs to file an undertaking electronically on the portal of income tax in Form-2 by waiving its right to seek or to pursue any remedy under any law.
- Certificate in From-3
The designated Authority, not below the rank of commissioner will review the application filed in Form-1 and Form-2 and based upon other evidences available will issue a certificate in Form-3 determining the total amount payable under the scheme. Form-3 will be issued within 15 days from filing of Form-1 and Form-2.
- Intimation in Form-4
The applicant need to deposit the amount payable as specified in the certificate issued in Form-3, afterwards proof of payment along-with proof of withdrawal of appeals need to be filed in Form-4. This Form-4 is intimation of tax paid by applicant.
- Discharge Certificate in Form-5
Upon filing of Form-4, the designated authority, not below the rank of commissioner will issue final order in Form-5 mentioning full and final payment from the applicant.
Relief measures in Tax Amnesty Schemes in the name of Vivad se Vishwas Scheme are:
Payment made on or before
Appeal, writ, SLP, arbitration relates to dispute tax
Appeal, writ, SLP, arbitration relates only to disputed penalty or interest or fee
31st March 2020
100% of disputed tax (125% in search cases). Waiver of Interest and Penalty.
25% of disputed penalty or interest or fee
End date (extended to 31st December 2020)
110% of disputed tax (135% in search cases). Waiver of Interest and Penalty.
30% of disputed penalty or interest or fee
In case taxpayer’s pending appeal already decided in favour of tax payer by higher appellate forum or if department has filed appeal, amount payable would be 50% of aforesaid amounts. If excess payment is made before filing declarations then refund shall be issued without interest.
With the ever changing Law and regulatory requirements, we keep on track and advise the same on timely manner in order to ensure proper compliance. We at ReturnFilings.Com will understand the purpose of your tax amnesty schemes in this SVS scheme 2020 and thereafter will provide you detailed analysis mentioning the law requirement and compliances need to fulfil in order to avail proper relief and fulfill all compliances. We at ReturnFilings.Com will provide you details of regulatory filings in order to ensure proper smooth and timely compliances. We at ReturnFilings.Com are determinate to provide end to end solution; our motto is you concentrate on your business while we at ReturnFilings.Com will take care of all your compliances need for tax amnesty schemes.