The Income Tax Department has extended the 2024 deadline for the Vivad Se Vishwas Scheme 2024 to January 31, 2025. Originally scheduled to end on December 31, 2024, the extension gives taxpayers additional time to resolve low-level tax disputes avoiding a 10 per cent penalty for late filings.
Benefits of extension of time
Announced in Budget 2024, the Vivadase Vishwas scheme aimed to resolve tax disputes by allowing taxpayers to pay a discount on the disputed amounts.
For applications submitted by January 31, 2025:
- 100% of the disputed tax.
- 25% of the disputed penalty or interest.
For applications filed after February 1, 2025:
- 110% of the disputed tax.
- 30% of the disputed penalty or interest.
This extended timeline ensures better compliance and reduces the financial burden for participants.
A well-designed compliance system
The system follows a simple roadmap of basic methods:
- Form-1: Taxpayers declare intent to resolve disputes.
- Form-2: Issued by the Income Tax Department after successful payment.
Taxpayers have to pay within 15 days of receiving of Form-2 to avoid penalties, which makes compliance and dispute resolution much easier.
Encouraging compliance and transparency
This extension highlighted the government’s proactive approach to simplifying tax resolution and reducing litigation. Taxpayers are urged to utilise this extended window to settle disputes, avoid additional taxes, and contribute to a transparent and dispute-free tax environment.
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