Tax amnesty 2083: fines and interest waived on income tax, VAT, excise and customs
The Finance Act 2083 includes a one-time amnesty for taxpayers who are behind. The idea is simple: pay the tax itself plus 1% of that tax by the deadline, and past fees, fines, additional charges and interest are waived. The tax is not waived, only the penalties on it.
What is normally charged (and is being waived)
| Law | Item | Normal charge |
|---|---|---|
| Income tax | Return (D3) filed late | Higher of 0.1% a year of assessable income or Rs. 100 a month |
| Income tax | Unpaid tax | 15% a year interest |
| VAT | Return filed late | Rs. 1,000 per return |
| VAT | Unpaid VAT | 15% a year interest |
| Excise | Late return or payment | Fee per return plus 15% a year interest |
Income tax
| Your situation | What to do | What is waived |
|---|---|---|
| Never took a PAN but earned taxable income | Take a PAN, file returns for FY 2079/80 to 2082/83 and pay the tax | All fees and interest; years before 2079/80 are not pursued |
| PAN holder with no income or activity | File the FY 2082/83 return, then apply to cancel or reactivate the PAN | Earlier returns are not required. PANs not dealt with are cancelled automatically |
| Registered, with unpaid tax or unfiled returns | File the returns and pay the tax plus 1% | Late-filing fees and interest |
| Filed a return but didn't pay | Pay the balance plus 1% | Fees, additional charges, penalties and interest |
| Assessed by IRD but not paid | Pay the assessed amount plus 1% | Fees, charges, penalties and remaining interest |
| Case under review, at the Revenue Tribunal or in court | Withdraw the case and pay the tax plus 1% | Penalties, interest and charges |
Telecom service providers are excluded from the assessed and disputed categories. Resident employees of UN bodies, international organisations and diplomatic missions who are not exempt can pay the tax for FY 2079/80 to 2082/83 plus 1% by Mangsir end 2083.
VAT
- VAT not collected or returns not filed: file the returns up to Chaitra 2082 and pay the VAT plus 1%. Interest, additional fees and penalties, including the Rs. 1,000 per late return, are waived.
- Declared but unpaid, assessed but unpaid, or under dispute: the same tax plus 1% settlement as income tax applies.
- Some sector items are written off automatically, with nothing to file: VAT not collected by insurance agents up to FY 2082/83, past VAT on paneer sales, and certain luxury fee and VAT items on gold and silver ornaments.
Excise duty
- Dealt in excisable goods without collecting excise: file the return and pay the excise plus 1% by Poush end; late fees and penalties are waived.
- Declared, assessed or disputed excise: the tax plus 1% settlement applies.
- Licence not renewed: paying the FY 2082/83 renewal fee waived the renewal fees and penalties for other years, with a deadline of Ashoj end 2083. Check with the tax office whether this was extended; unrenewed licences are cancelled.
Customs duty
There is no general customs amnesty for ordinary late payments. Relief is limited to specific cases:
- Post-clearance audit: importers who have not paid customs, excise or VAT assessed in a post-clearance audit by Baishakh end 2083, or whose case is at the Revenue Tribunal or in court, can pay the full duty and taxes assessed by Poush end. The penalty and interest are waived. No extra 1% applies here.
- Shipping companies: containers lying in customs premises can be taken back with fees and demurrage waived, by Mangsir end 2083.
How much it saves: an example
A small company, three years behind, with Rs. 20,000 of tax due each year:
| Without the waiver | With the waiver | |
|---|---|---|
| Base tax (3 × Rs. 20,000) | Rs. 60,000 | Rs. 60,000 |
| 1% of tax | – | Rs. 600 |
| Late-filing fees (s.117) | about Rs. 7,200 | Rs. 0 |
| Interest at 15% (s.119) | about Rs. 18,000 | Rs. 0 |
| OCR fines (paid-up up to Rs. 25 lakh) | about Rs. 64,000 | Rs. 0 |
| Total | about Rs. 1,49,200 | Rs. 60,600 |
VAT example: 12 monthly returns not filed with Rs. 50,000 VAT due. Normally that is Rs. 50,000 plus Rs. 12,000 in late-return fines plus interest. Under the waiver it is Rs. 50,500.
Checklist before you pay
- Identify the law (income tax, VAT, excise, customs or Companies Act) and your situation.
- File every return up to FY 2082/83 (VAT: up to Chaitra 2082). Relief can fail if any required return is missing.
- Withdraw any pending case if you are settling a dispute.
- Pay before the deadline, and keep the payment voucher and the office's waiver decision.
Behind at OCR too? See our article on the OCR fine waiver. To work out what you owe and file before Poush end, see tax and VAT services or book a consultation.
Summary of the Finance Act 2083 special provisions. It is not legal or tax advice. Confirm with the Inland Revenue Department, Department of Customs or Office of the Company Registrar.