Vivad se Vishwas Scheme 2024: A New Opportunity to Settle Old Income Tax Disputes

The 'Vivad se Vishwas Scheme 2024', which brought to end the old income tax disputes of taxpayers, has come into effect from Monday. This scheme was announced by Finance Minister Nirmala Sitharaman during the speech of the General Budget 2024. The objective of this scheme is to end the old dispute over income tax in the country.

What is Vivad se Vishwas Scheme?

Direct tax cases pending before the Income Tax Commissioner (Appeal), Income Tax Appellate Tribunal, High Courts or Supreme Court till July 22, 2024, can be settled through the Vivad se Vishwas Scheme 2024. Any person whose case is pending regarding income tax arrears can avail of the benefit of the Vivad se Vishwas Scheme 2024. However, those people who are facing serious income tax cases like search and seizure, and undeclared income abroad cannot take advantage of this scheme.

How can you avail of this scheme?

To avail of the benefit of this scheme, you will have to fill out Form 1 issued under the Dispute to Trust Scheme 2024, which has been made live on the Income Tax website, in which you will have to give a declaration. However, this does not mean that any of your declarations will be accepted by the tax authority.

This percentage penalty will be imposed

If your tax appeal is filed between January 31, 2020, and July 22, 2024, and the outstanding payment under this scheme is made between October 1, 2024, and December 31, 2024, then 100 percent of the disputed tax and 25 percent of interest, penalty, and fees will have to be paid. On the other hand, if you make the payment after January 1, 2025, then 110 percent of the disputed tax and 30 percent of interest, penalty and fees will have to be paid.

If the tax appeal is filed before January 31, 2020, and the outstanding payment under this scheme is made between October 1, 2024, and December 31, 2024, then 110 percent of the disputed tax and 30 percent of interest, penalty and fees will have to be paid. At the same time, if you pay after January 1, 2025, then 120 percent of the disputed tax and 35 percent of interest, penalty and fees will have to be paid.

Earlier, the Vivad se Vishwas Scheme 2020 was brought by the government, in which income tax appeals before January 31, 2020, were settled. This scheme received a positive response from the taxpayers.