☀️ Schemes
Income tax department nudges people with property abroad to use a one-time disclosure scheme
In 60 seconds: The Income Tax Department has begun nudging select taxpayers who own homes or shops in the UAE and other countries to declare them under a one-time scheme. About 1,100 people have applied under the Foreign Assets of Small Taxpayers – Disclosure Scheme, 2026 (FAST-DS), which lets eligible taxpayers regularise undisclosed foreign assets and income.
Why it matters
Undeclared foreign wealth escapes tax that honest taxpayers pay. A disclosure window brings it into the system with less litigation.
Explain it simply
A chai stall owner forgot to record a second stall in another town. The tax office says: declare it now with a small fee, or face a big penalty later.
The 3-minute read
What happened
Officials said the department is stepping up efforts to bring undeclared foreign wealth into the tax net, starting with taxpayers who hold residential and commercial property abroad.
Background
Under the Automatic Exchange of Information framework, including the Common Reporting Standard and the US FATCA law, other countries share details of accounts and assets held by Indians.
How it works
The department also plans to let taxpayers download details of foreign assets reported against their PAN by overseas jurisdictions for 2022-24, so they can check and correct their records.
What's next
More taxpayers are likely to receive messages as data from other countries is matched with tax returns.
What it means for you
Indian residents must report foreign assets, including bank accounts and property, in their income tax return, even if no tax is due on them.
Key numbers
- ~1,100: Applications under FAST-DS so far
- 2022-24: Years of foreign asset data to be shared
- 2015: Year of the Black Money Act
Both sides
- Tax department: A one-time scheme lets small taxpayers come clean before stricter action.
- Taxpayers using the scheme: It lets them correct past omissions instead of facing the Black Money Act's stiffer penalties.
Key terms explained
- Disclosure scheme
- A time-bound offer to declare hidden income or assets on easier terms.
- Undisclosed foreign assets
- Property, accounts or investments abroad not reported to the tax department.
The story so far
- 2015: Black Money Act and a one-time compliance window. The Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015 set stiff penalties for hidden foreign assets and offered a one-time window to declare them.
- 2015: India joins global automatic exchange of financial account data. India signed the agreement for the OECD's Common Reporting Standard and a FATCA agreement with the US in 2015, so foreign banks report accounts held by Indians to Indian tax authorities.
- Today: ~1,100 apply under FAST-DS
Exam notes (UPSC, SSC, Banking, PSC)
- The Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act was passed in 2015.
- The Common Reporting Standard (CRS) was developed by the OECD for automatic exchange of financial account information.
- FATCA is the US Foreign Account Tax Compliance Act.
- Resident taxpayers must report foreign assets in Schedule FA of the income tax return.
Likely exam question: How does automatic exchange of information help India tackle black money held abroad?