People work at a job and get paid for the work that they do. A part of what they earn is meant to be given to the government in the form of TAX. The government then uses this money that it collects from the people in order to repair and maintain all the common things we use – roads, hospitals, water supply, schools, and so on. The money that people are left with after paying their taxes is to be spent by them on whatever they want. This is White Money.
Some people do not want to pay so much in taxes. So they hide how much they really earn, from the government. So if they earn Rs. 100 in actuality, they might tell the government that they earn Rs. 80, and pay tax only on Rs. 80. This means that they can keep the Rs. 20 for themselves, without paying tax on it! This money that has not been taxed is called Black Money.