In response to false rumours about the need for tax approval for anyone travelling abroad, the Indian government issued a clarification.
Section 230 of the Income-tax Act, 1961 clarifies that not everyone According to the Central Board of Direct Taxes (CBDT), this requires a tax clearance certificate.
Tax clearance certificate for foreign travel not mandatory for everyone
This explanation is given in the answer to this question: Question The question was raised after Finance Minister Nirmala Sitharaman presented Budget 2024-25 on July 23.
The Budget has suggested adding the Black Money Act, 2015 to the list of Acts for which a tax clearance certificate is required only after fulfilling all obligations.
According to the CBDT, the proposed amendment does not make it mandatory for all residents to obtain a tax clearance certificate.
This requirement applies only in certain situations where such permission is needed.
These cases include those who have serious financial irregularities or have direct tax dues of more than Rs 10 lakh, which have not been withheld by any body.
Approval from senior tax officials like Principal Chief Commissioner or Chief Commissioner of Income Tax is required to obtain a tax clearance certificate.
This clarification is aimed at clearing any misunderstanding and reassuring the public that the new tax clearance rules will not hinder normal foreign travel.
In an effort to curb tax evasion and ensure compliance with tax laws, the government has added the Black Money Act, 2015 to this list.
What does Section 230 say?
Not everyone needs a tax clearance certificate, as per Section 230 of the Income Tax Act, 1961. Obtaining a tax clearance certificate will be necessary only in the case of specific individuals who have circumstances that require the certificate, PTI claimed.
According to the ministry, the Income Tax Department had said in a statement in 2004 that it is mandatory for individuals resident in India to obtain a tax clearance certificate only “under specific circumstances”.
