7 min learnNew DelhiUp to date: Aug 16, 2026 03:17 AM IST
The federal government has notified a one-time voluntary disclosure scheme, International Belongings of Small Taxpayers – Disclosure Scheme (FAST-DS), permitting taxpayers to declare their undisclosed foreign bank accounts, immovable property, jewelry, creative work, shares, securities or every other asset or revenue on cost of a specified tax or charge. The Central Board of Direct Taxes (CBDT) has notified the International Belongings of Small Taxpayers – Disclosure Scheme Guidelines, 2026, operationalising the Finances announcement of FAST-DS, efficient August 16 with final declaration date on December 31.
The scheme applies to 2 broad classes of asset or revenue — undisclosed overseas revenue or asset positioned exterior India as much as Rs 1 crore in worth; and belongings positioned exterior India as much as Rs 5 crore in worth acquired from revenue accruing or arising exterior India by an assessee when she or he was a non-resident, however didn’t declare them within the tax return on changing into a resident; or belongings acquired from revenue provided to tax beneath the Earnings-tax Act however not declared within the related schedule within the tax return.
Underneath the primary class, taxpayers have to pay 30% of truthful market worth of belongings or 30% of undisclosed revenue as tax and 30% as further revenue tax in lieu of penalty to be able to get immunity from prosecution. For the second class, immunity from each penalty and prosecution is obtainable with the charge cost of Rs 1 lakh.
On making a legitimate declaration and cost beneath FAST-DS, immunity can be supplied from any additional tax or penalty, and from prosecution, beneath the Black Cash Act, 2015, in respect of the revenue or asset so declared, the Earnings Tax Division mentioned. Additionally, the revenue or quantity of funding within the asset declared beneath this scheme won’t be included within the whole revenue of the taxpayer beneath the Earnings-tax Act or the Black Cash Act, it mentioned.
The CBDT has shared tax calculations for the declaration window with a number of examples:
Instance 1: an undisclosed overseas checking account existed as on March 31, 2026, with the worth of the checking account on that date at Rs 60 lakh. The assessee additionally earned undisclosed overseas revenue of Rs 20 lakh throughout earlier years. Then, the combination worth of the undisclosed asset and undisclosed overseas revenue is Rs 80 lakh (Rs 60 lakh + Rs 20 lakh), which doesn’t exceed Rs 1 crore. So, the case can be lined beneath the primary class of disclosure classes.
The tax on the undisclosed asset can be charged at 30% of Rs 60 lakh, that’s, Rs 18 lakh, whereas the tax on undisclosed overseas revenue can be 30% of Rs 20 lakh, that’s, Rs 6 lakh. In whole, combination tax payable can be Rs 24 lakh (Rs 18 lakh + Rs 6 lakh). The penalty payable can be 100% of combination tax, that’s Rs 24 lakh. Due to this fact, the overall quantity payable can be Rs 48 lakh (Rs 24 lakh tax + Rs 24 lakh penalty).
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Instance 2: A plot of land positioned exterior India was acquired in 2015 from revenue earned overseas when the assessee was a non-resident. After changing into resident in India, the assessee did not disclose the land within the related schedule of the revenue tax return. The worth of the land on the valuation date (March 31, 2026) is Rs 3 crore, which doesn’t exceed the Rs 5 crore restrict and will get lined beneath the second class. The quantity payable then can be a charge of Rs 1 lakh.
Instance 3: An assessee bought sure models of mutual fund overseas in 2020 from revenue provided to tax in India when the assessee was a resident. However the assessee did not disclose the mutual fund within the related schedule of the revenue tax return. The worth of the mutual fund on the valuation date was Rs 2.5 crore. The assessee additionally acquired sure quoted shares and securities on the New York Inventory Trade in 2022 and the worth of QS is Rs 4 crore. Then, the overall worth of each these belongings acquired in 2020 and 2022, is Rs 6.5 crore which exceeds the Rs 5 crore restrict. Then the assessee just isn’t eligible to declare beneath this scheme.
As per the newly notified guidelines, a declaration for any asset or revenue must be made electronically in Type 1 to the revenue tax authority beneath the 2 classes the place the combination worth of undisclosed revenue and belongings don’t exceed Rs 1 crore or Rs 5 crore, relying on the class beneath which the belongings are declared.
Aside from a checking account, the declaration for any asset won’t be handled as invalid or void on the grounds of misrepresentation, suppression of info, or furnishing of false materials particulars, provided that the variance between the truthful market worth and the worth decided by the assessing officer or every other revenue tax authority throughout any evaluation or inquiry doesn’t exceed 20%, the principles acknowledged.
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In her Budget speech in February, Union Finance Minister Nirmala Sitharaman had mentioned that the federal government will introduce a one-time, 6-month overseas asset window to handle sensible problems with small taxpayers like college students, younger professionals, tech staff, relocated NRIs and others, for disclosing revenue or belongings under a sure measurement.
The cost of the quantity payable beneath the scheme must be made inside two months of the order handed by the income-tax authority. If the cost is after two months however inside the further interval not exceeding two months, then a easy curiosity of 1% on the overall quantity payable must be paid for each month or a part of a month of delay. “The utmost further interval allowed is 4 months from the tip of the month through which the unique cost order (Type 2) was handed. If cost just isn’t made inside this outer restrict, the advantage of the Scheme ceases to be out there for that declaration,” the Earnings Tax Division mentioned.
For the scheme, the valuation date is March 31, 2026 and the truthful market worth of belongings proposed to be declared have to be computed as on this date. Honest market worth would be the greater quantity between the price of acquisition, and the value the asset would ordinarily fetch if offered within the open market on the valuation date, ideally supported by a report from a valuer recognised by the federal government (or its company) of the nation the place the asset is positioned, it mentioned. The place such market valuation just isn’t carried out, then the listed price of acquisition can be taken because the truthful market worth, it mentioned.
The scheme won’t apply if any revenue or asset, immediately or not directly, represents proceeds of crime in respect of which proceedings have been initiated, or are pending, beneath the Prevention of Cash-laundering Act, 2002; or any revenue or asset regarding an evaluation 12 months for which evaluation proceedings have already been accomplished beneath the Black Cash Act, 2015, the Division mentioned.
