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Can i hide my foreign salary income from original return??

Priya (Article) (94 Points)

03 August 2016

Hi friends, Pls help . I am an indian employee.

Duribg PY 2015-16..i was sent to UK by my employer for four months..

I have earned 5 lacs in India for 8 months and 12 lacs in UK as salary income.

During PY 15-16, TDS deducted in India was 70k. No tax has been deducted in UK.

Since i am running short of time and due to lack ofknowledge, i am planning to file itr1 with 7 lac income in india..i m thinking not to mention foreign salary for the time being..and fill the return with zero tax payment.

If needed in future then i will recise return and will show total 17lacs as my income ( indian +abroad) and pay the balance tax liability..

Is this possible?? What may be the consequences of it..??

No tax deducted in UK.. so no double taxation relief wud be allowed..so itr1 is applicable or itr2?

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13 Replies

Dhirajlal Rambhia (SEO Sai Gr. Hosp.) (177852 Points)
Replied 03 August 2016

Don't fool yoursef. Liabilty of tax payment, interest and penalty will be much more than any savings!! Better declare everything, pay tax at normal rate and relax. Department is much more vigilant now, specifically with foreign income.

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Udgam Koomar (Tax Technologist) (1949 Points)
Replied 03 August 2016

As per me, this is taxable since you are not even NRI and as per recent ITAT ruliing, you have to pay tax atleast at one place. You cannot revise a return by willful intention of hiding income that you already were aware of, revision is for error or ommission. may be since this income is not mentioned in form16, mention it in income from other sources in ITR1. hve you bought this 12L income in India? if yes, how have you bought it and is it in dollars or wire transfer??

Priya (Article) (94 Points)
Replied 03 August 2016

Thanks for ur reply.. but i want to know ..what can be the worst consequences if i dont pay tax on foreign income..

Just 1% interest ?? Anything else.. ??

I am not a fool to pay around 2 lac tax .. none of my friends have paid it in the past.. and nothing gone wrong..

Guys pls reply thinkibg of my benefit , not of department's.

It has a very less probability that my case picks up in scruitny.. even if my case picks up in scruitny.. then also how much interest and penalty will be leviable on 2 lac tax.. max 10-20 k. ??

Dhirajlal Rambhia (SEO Sai Gr. Hosp.) (177852 Points)
Replied 03 August 2016

Cannot suggest anything other than as per law. Its upto you to take chance.

Priya (Article) (94 Points)
Replied 03 August 2016

I am ready to take chance..do u hv any idea about how much interest and penalty would be levied in that case??

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Dhirajlal Rambhia (SEO Sai Gr. Hosp.) (177852 Points)
Replied 03 August 2016

Read section 270A(1) of IT, for details

CA Harshal Totla (Chartered Accountant) (2229 Points)
Replied 03 August 2016

Sorry madam, we advice clients what is within the four corners of law and not what we call as tax evasion. Declare your true income, pay your tax liabilty, you can reduce your tax liabilty by investing in modes prescribed u/s Chapter VI-A and stay stress free. Now a days scenario has changed completely, ITD has become so vigilant specially in relation to foreign income/ foreign assets. Rest is up to you.

CMA-FINAL (Adv.) (243 Points)
Replied 03 August 2016

Priya, you will be taking a huge risk. The consequences will be huge and will make you think, why did you even do it the first time.
The consequences could wipe out about thrice your income and can send you to jail. Harshal is very much right and 2 lacs will not be worth it in the end.

Just give a visit to leading tax practitioner in your city.

Priya (Article) (94 Points)
Replied 03 August 2016

Jail????😷.. as per my knowledge..this is a bailable offence..😑

And i might end up paying thrice of the tax payable .. not thrice of the income.

CMA-FINAL (Adv.) (243 Points)
Replied 04 August 2016

And I was not talking about 3 times tax penalty..I was talking about the income you are trying to save from taxation.

Anyways how do you know its bailable..you have thought about it in much detail, haven't you!!!

Is this a imaginary case or is it your own case?

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CA Vasiullah (Vasi) (Audit Executive) (1813 Points)
Replied 04 August 2016

The penalty will be 100% to 300% of tax sought to be evaded under section 271(1)(c), in addition to interest under section 270. So best option will be to honestly pay the tax and relax.

sourabh singh (....) (73 Points)
Replied 05 August 2016

Mam if ur foreign income credited in your account than its better to disclose to department ...
because you have to disclose your bank a.c detail to dept.
moreover now there is AIR system in india , possibly your foreign receipt is already known to dept.

and yes if you not disclose your income than there will be very huge prosecution with an penalty of 3 times of you tax..with int

Nikhil T (-) (68 Points)
Replied 30 July 2024

In case of a resident, how to disclose income received when exercising employment (on secondment) to foreign country? Under article 15 of india-swiss dtaa, such income is taxable where employment is exercised. In ITR 2, foreign tax is lower than indian tax thereon but under treaty it is not taxable