Income Tax: Govt Extends Direct Tax Vivad Se Vishwas Scheme; Here’s What You Need To Do

The government has extended the deadline for taxpayers for the direct tax Vivad Se Vishwas scheme. On Monday, the Central Board of Direct Taxes (CBDT), announced the due date for determining the (tax) amount payable has been extended from December 31, 2024, to January 31, 2025.

In a notification issued on the official website of the Income Tax Department, the CBDT stated that the extension would provide taxpayers additional time to determine the amount payable as specified in column (3) of the relevant table in the scheme.

What is the Direct Tax Vivad se Vishwas Scheme?

The Direct Tax Vivad se Vishwas Scheme, 2024 (DTVsV Scheme, 2024) was introduced by Union Finance Minister Nirmala Sitharaman in the Budget 2024-25. The scheme aims to help taxpayers resolve disputes with the income tax department.

The DTVsV scheme was officially notified by CBDT on 20 September, it came into effect on 1 October 2024. It enables taxpayers to settle their outstanding tax liabilities by paying the disputed amount along with a specified percentage.

Here’s What You Need To Do

Taxpayers can avail DTVsV scheme if;

1) Your appeals/writ petition/special leave petition (SLP) relating to disputed tax, interest, penalty or fee is pending before the Income Tax Appellate Tribunal (ITAT)/High Court/Supreme Court.

2) You have filed any objections before the Dispute Resolution Panel and the authority is yet to issue any directions

3) DRP has issued directions but the tax authority has not passed an assessment order in conformity with said directions

4) Revision application is filed by the taxpayer before the Commissioner.

It is important to note that the scheme is open to both taxpayers and tax authorities involved in any such disputes.

DTVsV allows you to settle any ongoing tax dispute by paying a reduced amount. The extension till the last of January provides a significant relief for those taxpayers who have yet to apply. Earlier, taxpayers would have faced an additional 10 per cent tax penalty for applying.

As you clear your income tax disputes under this scheme, remember that;

- You have to pay the disputed tax amount along with a specified percentage.

- Once the payment and application are submitted, the ITD will waive additional penalties and interest, thereby closing the dispute.

To get the benefit of lower settlement amounts, taxpayers should file the declarations before January 31, 2025. Those who would miss out on this extended deadline and file from February 1, 2025, onwards would incur additional charges.