We have provided Step by Step procedure to Disclose and Declare Income under Pradhan Mantri Garib Kalyan Yojana (PMGKY) Scheme. Persons declaring their income under PMGKY Scheme shall file a Declaration in Form 1. A amount equal to 25% shall also be deposited (which is explained below). In our previous article, we have clearly explained the PMGKY Scheme and its implications.
Step 1 : Pay Tax as per the PMGKY Scheme
• The above table explains how much amount is to be paid as tax, how much deposit is to be placed with Government. Firstly, Up-front tax payable is 50% of Disclosed Sum i.e. Rs.50 (Including Surcharge and Penalty) in our case.
This Tax is to be paid as normally you pay. Tax is to be paid before any kind of Declaration under this scheme is made. Please keep a copy of proof of Tax Payment.
Step 2 : Deposit as prescribed by PMGKY
• Invest a minimum of amount equivalent to 25% of your Disclosure i.e. Rs. 25 in our case, in such Deposits which can be opened at your bank along with an application Form II (Draft has been attached) giving various details of the Depositor.
This Deposit shall be redeemed (returned to depositor) on Completion of Four Years from date of Deposit and will not earn any interest in these 4 years. Please keep the proof of Deposit made by you in this scheme.
• As an Acknowledgement of receipt of such amount you will receive a Certificate from the Bank in Form I (Draft Attached).
• There are other Forms for Nomination and cancellation of Nomination, etc (Form III and Form IV respectively).
Step 3 : Declaration under PMGKY
• After above 2 Steps now it is time to furnish Declaration of your Undisclosed Income u/s 199C (1) which is to be made by filing a form with Income Tax Department. This is to be filed in Form 1 (Draft Attached).
• Such Declaration shall be furnished to Principal Commissioner/ Commissioner as the case may be and can be submitted online (by EVC or DSC) or in Print Mode and if any Omission or Wrong Statement is found, then it may be revised.
• The Principal Commissioner will issue a Certificate (Acknowledgement) in Form 2 (Draft Attached) to the Declarant within 30 days from end of the month in which a valid declaration u/s 199C is furnished.
How to File Form 1 Declaration under PMGKY
• For Filing Form 1 you must have registered yourself on ITD Portal.
• Please keep scanned copy proof of payment of tax and scanned Copy proof of Deposit made under the scheme ready.
• Log in into the ITD Portal, then there is a separate Menu named as “PMGKY”, and in that select “Prepare and Submit Online Form 1”. Then select appropriate option. If you want to submit the form using “EVC”, then you must select “submit To: Jurisdictional PCIT/CIT.”
• If you want to submit using A Digital Signature, then you can select any of the options.(Jurisdictional PCIT/CIT or CPC Bengaluru).
• Go ahead by Clicking “Continue” and then fill in all the details such as name, Address, etc.
• Then enter the details of Undisclosed Income (i.e. Rs. 100 in our case) which may be shown as Held in Cash or Deposited in Bank Account. On the basis of amount entered here, Tax, Surcharge, Penalty fields will be Calculated automatically.
• Then enter details of tax payment as asked for.
• In next step user is required to enter the amount of Deposit (Bond) made with the bank (it should be >= 25% of Undisclosed Income), in our Case it is Rs. 25 and then enter other details as asked for.
•bull; Click on Submit button and then select “ Verification” and fill in the details.
• Then go to Attachments tab where you are required to attach scanned copy of proof of payment of Tax and proof of Deposit made with the bank as given in Step 1 & 2.
• Then go ahead and “Submit” the Form and select a method of verifying the form and verify it.
Form I (Acknowledgement of receipt of Amount of Deposit as required).
Form II (Application form for opening a “Deposit” of amount >= 25% of Disclosure).
Form 1 (Form to be filed for Disclosure of Sum under the Scheme).
Form 2 (Acknowledgement received on filing Form 1)
Form 1 and 2 are available here
Pradhan Mantri Garib Kalyan Yojana is the last chance available to the Black Money holders in India to disclose their unaccounted wealth.
PMGKY brings a new variety to the Income Tax Act. The provisions mentioned in Pradhan Mantri Garib Kalyan Yojana Scheme are famous in the countries of Europe in 1930s. We hope the PMGKY Scheme will be a grand success.