Ahmedabad: Taxpayers with foreign assets are waiting for rules to catch up with a promise made in the Union Budget. A proposed six-month amnesty window remains unavailable even as the income tax department steps up scrutiny of overseas holdings. Tax professionals say the delay has left affected residents uncertain about this year’s returns.The confusion comes as foreign-asset details increasingly appear in tax notices and Annual Information Statements.The I-T department has been seeking details of foreign bank accounts, investments, and income in tax returns. Meanwhile, the Union Budget 2026-27 proposed a settlement window for past omissions. With its rules, forms, and operating guidelines still awaited, tax professionals say affected taxpayers are uncertain about how to proceed with this year’s returns.
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International tax expert Mukesh Patel said the govt announced a scheme for taxpayers with foreign assets and income in Febr, but it has not yet been implemented. “Such taxpayers are confused whether they should disclose their foreign assets in the ITR this year,” he said.The Foreign Assets of Small Taxpayers – Disclosure Scheme, 2026 (FAST-DS), proposed in the Budget, offers resident Indians a one-time, six-month window to declare previously unreported overseas holdings. These may include foreign bank accounts, employee stock options (ESOPs), restricted stock units (RSUs) and mutual funds.A key feature is the proposed immunity from prosecution and steep penalties under the Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act.FAST-DS divides eligible cases into two categories. Category A covers overseas income or assets that were not disclosed and on which tax was not paid in India. It applies to foreign assets with a fair market value of up to Rs 1 crore as of March 31, 2026. Taxpayers opting for this category would have to pay a total levy of 60% of the fair market value, comprising 30% tax and an additional 30% penalty or fee, Patel said.Category B covers assets acquired either from income on which Indian tax had been paid or while the taxpayer held non-resident status. It applies where such assets were subsequently omitted from the foreign-asset schedules of the ITR after the individual became a resident. Assets valued at up to Rs 5 crore as of March 31, 2026 would be covered on payment of a flat fee of Rs 1 lakh.The scheme’s six-month period will begin only after it is formally notified. Patel said taxpayers were still awaiting the guidelines, forms and rules required to use it.Chartered accountant Karim Lakhani said overseas asset details were also appearing in taxpayers’ Annual Information Statements (AIS). Taxpayers should examine their AIS for previous years and, if the information is accurate, assess whether updated returns are required, he said. Incorrect information should be disputed or reported to the department.
