Income Tax Department shares foreign assets info with taxpayers, nudges for disclosure
New Delhi, Sep 28, 2026
Income Tax Department advisory says it's an opportunity for voluntary compliance for Foreign Assets of Small Taxpayers – Disclosure Scheme (FAST-DS), 2026, last date for which is December 31
In a bid to nudge taxpayers to report overseas assets under the ongoing disclosure scheme — Foreign Assets of Small Taxpayers-Disclosure Scheme (FAST-DS) — the Income Tax Department has sent out a series of e-mails and messages to them, sharing specific information about the ownership of overseas stocks, bank accounts or assets.
In the e-mails and messages shared with the taxpayers, the Income Tax Department said that its records indicate ownership of overseas assets that may have been “unreported or acquired from undisclosed sources”, urging taxpayers to check details in their Annual Information Statement (AIS) on the income tax portal and then report under the disclosure scheme, three people aware of the communication said.
The e-mails have been sent to the taxpayers with the subject line — ‘Important advisory: opportunity for voluntary compliance regarding FAST-DS, 2026’, adding that it was a system-generated communication. One of the taxpayers told The Indian Express that he has received a notice for holding a bank account in Singapore when he used to have non-resident status a few years ago, while another taxpayer said that he got the notice for his overseas bank accounts opened during his studies that subsequently turned dormant and are purged.
An income tax official said that the Department had been planning to share the details about ownership of overseas assets with the taxpayers to nudge them towards FAST-DS, but did not specify the number of such communications sent to the taxpayers.
Many taxpayers shared their notices on social media platforms like X and Reddit. One of them, Kapil, posted that he had received a notice for one of his bank accounts opened in Europe where he lived for four years and then returned to India in December 2022. He claimed one of the active European bank accounts had zero balance, and that he has been filing income tax returns for the last three years. Now, in his AIS, the Income Tax Department has shown details of another European bank account with a zero balance over the last three years.
The query posted by him to other social media users was whether he was supposed to pay a Rs 1 lakh penalty and whether signing up for FAST-DS means acceptance of a mistake.
The e-mail shared by the tax department asks taxpayers to log into the e-filing portal, check the details and use ‘Kar Saathi’ on the portal for assistance regarding forms, compliance, procedures and related queries.
“Our records indicate that you may have overseas financial interests (such as bank accounts, shares, immoveable property etc.) acquired in earlier years that are required to be reported in the Income Tax Return. If your overseas financial interests (assets/income) have been left unreported in your earlier Income Tax Returns or have been acquired through undisclosed sources, we encourage you to utilise the ongoing, one-time compliance window under the FAST-DS (Foreign Asset of Small Taxpayers-Disclosure Scheme). This dedicated window is open till 31.12.2026. Also, you may view your Foreign Assets Information on the AIS through the e-filing portal,” the e-mail from the tax department stated.
Many taxpayers complained of not having access to bank account statements for their overseas accounts, while some were not clear whether this will lead to further scrutiny and notices from the Income Tax Department.
Another user said that he had bought US shares of $100 from 2022 to 2024 and then sold all the shares in July 2024 but never mentioned these in his ITR. “I’m a student and I don’t have any income. I just used to file nil ITR. Kindly tell me what I should do now,” he wrote in a Reddit post.
When the government proposed the new tax disclosure scheme in this year’s Budget, the intent was well specified — to address “practical issues of small taxpayers like students, young professionals, tech employees, relocated NRIs” among others.
However, as reported by The Indian Express earlier this month, the tax disclosure window, FAST-DS, which was launched on August 16, has resulted in doubts and questions as individuals face high fees and penalties to participate in the scheme. The problem is more acute for salaried individuals who have received restricted stock units (RSUs) or ESOPs and not reported them before.
Even for cases where there has not been any actual gain, the employees will now be required to pay Rs 1 lakh for disclosing under the new scheme, which is being seen as too steep an amount as penalty by many. ESOPs are an important salary component for salaried employees in many sectors, especially those working in the tech sector, startups, and foreign companies.
The scheme applies to two broad categories: i) undisclosed and never-before-taxed foreign income or asset located outside India up to Rs 1 crore; ii) asset up to Rs 5 crore located outside India, which was already offered to tax or was acquired when the assessee was a non-resident, but not declared in the relevant schedule of the income tax return. Under the first category, an assessee needs to pay 30% of fair market value (FMV) of assets or 30% of undisclosed income as tax and 30% as additional income tax in lieu of penalty, while for the second category, the disclosure fee is Rs 1 lakh. The scheme was notified to be effective from August 16 with the last declaration date on December 31.
[The Indian Express]
