Undisclosed foreign income? Here’s how new tax window can help

The Income Tax Department has introduced a new window for taxpayers to voluntarily disclose undisclosed foreign income and assets up to a limit of Rs 5 crore. This scheme, called the Foreign Assets of Small Taxpayers - Disclosure Scheme (FAST-DS), was introduced from August 16 to December 31, 2023. The scheme offers immunity from prosecution for taxpayers who disclose foreign income and assets that have not been taxed before, up to a maximum limit of Rs 1 crore.

For assets located abroad that were taxed or acquired by a non-resident but not declared in income tax returns, the disclosure is allowed for assets up to Rs 5 crore. Taxpayers can disclose foreign bank accounts, immovable property, jewelry, artistic work, shares, securities, or any other asset or income under the scheme. However, the declared value should not exceed the slab limits, and undeclared income or asset representing proceeds of crime is not eligible for disclosure under the scheme.

The scheme operates alongside existing foreign-asset reporting requirements, and the valuation date for assets is March 31, 2026.