Missed reporting Foreign Assets in ITR? Here is Foreign Assets of Small Taxpayers Disclosure Scheme, 2026
A Complete Guide for Taxpayers Introduction Many Indian taxpayers hold a foreign bank account, an inherited property abroad, a handful of foreign shares, or income earned overseas — and, often without any intent to evade tax, never got around to reporting it in their Indian income-tax return. Under the existing law, such gaps fall within the reach of the Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015 (the Black Money Act), which was designed to deal with serious concealment and carries correspondingly severe consequences. Recognising that a large number of these cases involve modest amounts and unintentional lapses rather than deliberate evasion, the government has introduced the Foreign Assets of Small Taxpayers Disclosure Scheme, 2026 (FAST-DS) — a one-time voluntary disclosure window under Chapter IV (sections 130 to 144) of the Finance Act, 2026, backed by the Foreign Assets of Small Taxpayers Disclosure Scheme Rules, 2026, notified by the CBDT on 14th August 2026. It lets eligible taxpayers come forward, declare the asset or income, pay a specified amount, and walk away with immunity — without going through the far harsher Black Money Act route. Quick Details Particular Detail Legal basis Sections 130–144, Chapter IV, Finance Act, 2026, read with the FAST-DS Rules, 2026 Date of commencement 16th August 2026 Last date to file declaration 31st December 2026 (no extensions contemplated) Valuation date 31st March 2026 Declaration form Form 1, filed electronically Administering authority Principal Director General / Director General of Income-tax (Systems) Monetary ceiling — undisclosed asset/income ₹1 crore Monetary ceiling — reporting lapse on already-taxed asset ₹5 crore Amount payable — undisclosed asset/income 30% tax + equal additional amount (effectively 60%) Amount payable — reporting lapse Flat ₹1 lakh Who Must Take Benefit of This Scheme FAST-DS is aimed squarely at what its name suggests — small taxpayers, not large-scale concealment cases. You should seriously consider using this Scheme if you fall into any of these situations: You hold a foreign bank account, foreign property, foreign shares or securities, jewellery, or any other asset located outside India, and never reported it in any Indian tax return. You earned income from a source outside India — interest, rent, dividends, capital gains, or otherwise — that was taxable in India but was never offered to tax. You did report a foreign asset in your books or elsewhere, or it was acquired while you were a non-resident, but it never made it into the specific foreign-assets schedule of your income-tax return. You are worried about a past lapse being picked up later — for instance through automatic exchange of financial account information between countries — and want to regularise your position on your own terms rather than waiting to be caught. In each of these cases, coming forward voluntarily under FAST-DS is almost always preferable to the alternative of the tax department discovering the gap independently, because the Scheme trades a fixed, known cost today for the open-ended exposure of tax, penalty and possible prosecution later. Applicability Who can declare You qualify as an eligible “assessee” if you are resident in India (under section 6 of the Income-tax Act) for the relevant previous year, or if you are currently a non-resident or resident-but-not-ordinarily-resident (RNOR) but were resident in India either in the year the income relates to or the year the asset was acquired. A change in your residential status since then does not disqualify you. When it applies A declaration is available where you failed to furnish a return altogether, failed to disclose the asset or income in a return you did file before the Scheme commenced, or where the asset or income would otherwise be treated as having escaped assessment under section 147 of the Income-tax Act. Monetary thresholds Applicability splits into two tracks, and you must check the one relevant to you: Track 1: An undisclosed foreign asset or undisclosed foreign income that was never offered to tax — available only where the combined value does not exceed ₹1 crore as on the valuation date. Track 2: A foreign asset already offered to tax, or acquired while you were non-resident, but not declared in the relevant schedule of the return — available only where the aggregate asset value does not exceed ₹5 crore. Cross the applicable ceiling and the Scheme is unavailable for that declaration entirely; there is no scaled-down benefit. Where it does not apply, regardless of value The Scheme is off the table if the income or asset represents proceeds of crime with proceedings already initiated or pending under the Prevention of Money-Laundering Act, 2002, or if assessment proceedings for that year have already been completed under the Black Money Act, 2015. Determination of Tax Liability Track 1 — undisclosed asset/income The amount payable is the aggregate of tax at 30% of the declared value, plus a further amount equal to that tax — effectively a 60% levy on the total. Illustration: Description Value / Income Tax (30%) Additional 100% of tax Total payable Foreign bank account ₹60 lakh ₹18 lakh ₹18 lakh ₹36 lakh Foreign income ₹20 lakh ₹6 lakh ₹6 lakh ₹12 lakh Total ₹24 lakh ₹24 lakh ₹48 lakh Track 2 — reporting lapse The amount payable is a flat ₹1 lakh, irrespective of whether the asset is worth ₹50 lakh or the full ₹5 crore ceiling. Valuing the asset Everything is valued as on 31st March 2026. As a general rule, fair market value is the higher of the original cost of acquisition and the open-market price on the valuation date (ideally backed by a recognised valuer’s report); where no such valuation is done, the indexed cost of acquisition applies instead. Foreign bank accounts follow a distinct rule — value is the sum of all deposits made into the account since it was opened, up to the valuation date, excluding amounts that are really a withdrawal being redeposited, and excluding deposits already covered by an earlier Black Money Act declaration. Paying