Section 4 of The Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015
- (1)Subject to the provisions of this Act, the total undisclosed foreign income and asset of any previous year of an assessee shall be,—
- (a)the income from a source located outside India, which has not been disclosed in the return of income furnished within the time specified in Explanation 2 to sub-section (1) or under sub-section (4) or sub-section (5) of section 139 of the Income-tax Act;
- (b)the income, from a source located outside India, in respect of which a return is required to be furnished under section 139 of the Income-tax Act but no return of income has been furnished within the time specified in Explanation 2 to sub-section (1) or under sub-section (4) or sub-section (5) of section 139 of the said Act; and
- (c)the value of an undisclosed asset located outside India.
- (2)Notwithstanding anything contained in sub-section (1), any variation made in the income from a source outside India in the assessment or reassessment of the total income of any previous year, of the assessee under the Income-tax Act in accordance with the provisions of section 29 to section 43C or section 57 to section 59 or section 92C of the said Act, shall not be included in the total undisclosed foreign income.
- (3)The income included in the total undisclosed foreign income and asset under this Act shall not form part of the total income under the Income-tax Act.
Summary
- This provision defines what counts as undisclosed foreign income, such as money from a source outside India that was not mentioned in a required tax return.
- It includes income for which the person was supposed to file a return but failed to do so within the allowed time.
- It adds the total value of any hidden assets located outside India to the amount being taxed.
- It excludes certain changes or variations made to foreign income during a regular income tax review under specific sections of the Income tax Act.
- It ensures that any income taxed under this specific law is not included in the person's regular total income for normal income tax purposes.
Practical examples
FAQ
1. Does Section 4 of the Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015 include income if I didn't file any tax return at all?
Yes, Section 4 includes income from outside India where a return was required but was not furnished within the specified time.
2. Is the same income taxed twice under both regular income tax and this law according to Section 4 of the Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015?
No, Section 4 states that income included under this Act shall not form part of the total income under the regular Income-tax Act.
Test yourself
Q1.Under Section 4 of The Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015, which of the following is part of the scope of undisclosed foreign wealth?
Q2.According to Section 4 of The Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015, what is the status of income taxed under this Act regarding the regular Income-tax Act?
Q3.Under Section 4 of The Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015, if a person fails to file a return, what foreign income is included?
Q4.In combination with the tax rate in Section 3, how much tax would be paid on the value of an undisclosed asset defined in Section 4 of The Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015?