Income Tax Department: The Income Tax Department said that false propaganda is being spread regarding obtaining Income Tax Clearance Certificate to travel abroad. Therefore, a detailed clarification has been issued regarding this.
Income Tax Clearance Certificate: CBDT has issued a clarification regarding the false news spreading about obtaining Income Tax Clearance Certificate for Indian Citizens before traveling abroad. In its statement, the tax department said, it is being falsely propagated that it is necessary for all citizens to obtain Income Tax Clearance Certificate before leaving the country. According to CBDT, this is beyond the truth.
Rules do not apply to all citizens
The Central Board of Direct Taxes has given detailed information about in which cases Income Tax Clearance Certificate will be required. The tax department said, under section 230 of the Income Tax Act, it is not necessary for all citizens to obtain Tax Clearance Certificate before traveling abroad. In the cases of some individuals, it is necessary to obtain Tax Clearance Certificate under special circumstances. CBDT said that this provision has been in place since 2003 and despite the amendment in the Finance (No. 2) Act 2024, no change has been made in this system.
Rules applicable on persons involved in financial fraud
The Income Tax Department said that on February 5, 2024 itself, the CBDT has clarified that which citizens living in India will need an Income Tax Clearance Certificate before leaving the country under Section 230(1A) of the Income Tax Act. For example, if a person is involved in serious financial irregularities and under the Income Tax Act or the Wealth Tax Act, it is necessary for that person to be in the country for investigation of these cases and a tax demand can be issued against that person, then such a person will have to obtain a Tax Clearance Certificate before leaving the country.
If there is a tax arrear of more than Rs 10 lakh…
Also, if a person has direct tax arrears of more than Rs 10 lakh and no authority has put a stay on it, then such a person will also have to obtain a Tax Clearance Certificate before leaving the country. Before asking any person to obtain an income tax certificate, reasons will have to be recorded and approval will have to be obtained from the Principal Chief Commissioner of Income Tax or Chief Commissioner of Income Tax. CBDT said in its clarification that Indian citizens will have to obtain an income tax clearance certificate before leaving the country only in special cases where serious financial fraud has been committed and tax demand is more than Rs 10 lakh.
