Here’s what Indians residing abroad can do to avoid law suit under the Black Money Law
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An Economic Times report states that such investment plans would be considered as foreign assets as per the
Kuldip Kumar, partner at PwC India said, "There are plans where the subscriber has certain control in terms of investments — those would definitely need to be disclosed.”
Professionals working overseas, however, are approaching tax practitioners for identifying disclosures that they are supposed to make. Queries around investments made by individuals in pension and endowment plans are very common as these plans may give in some benefit to the subscribers a few years down the line.
As per the Black Money Law, a direct holder of an asset and a beneficial owner should essentially be named. The latter is defined as an individual who has provided, directly or indirectly, consideration for the asset for the immediate or future benefit, direct or indirect, of himself or any other person.
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Divya Baweja, partner at Deloitte Haskins & Sells LLP says, "A plan such as 401k may need to be disclosed. But one would need to analyze the various plans and the vesting criterion under it closely. It should not be merely a contingent right. A view may be adopted that if you have an enforceable vested right, it is an asset and needs to be disclosed. Some clarity may be required on this."
As a part of Narendra Modi’s black money crackdown, this is one last opportunity for people to declare overseas assets under a compliance window that closes on September 30. All Indians having a foreign asset can use this by paying 30% tax and 30% penalty to avoid prosecution.
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