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Informist, Saturday, Aug. 15, 2026

NEW DELHI - The finance ministry has notified a scheme providing a one-time voluntary window to taxpayers to disclose small value foreign assets and income. The scheme will take effect Sunday and run till the end of December.

The scheme allows eligible taxpayers to declare certain undisclosed foreign assets and foreign income on payment of a specified tax or fee. "The valuation date (of the assets) is 31st March, 2026. The fair market value of assets proposed to be declared must be computed as on this date," the ministry said.

This comes a month after the Central Board of Direct Taxes enabled the display of information on foreign assets and income received under the Automatic Exchange of Information framework in the Annual Information Statement of eligible taxpayers on the Income Tax e-Filing portal. This was a step towards promoting voluntary tax compliance and not to investigate undisclosed income, government sources had said.

India has already had income declaration schemes to tax black money, the latest being the 2016 avatar under then finance minister Arun Jaitley. At that time, the government had offered a one-time chance to individuals with income and assets that had illegally escaped taxes to come clean by paying a tax and penalty of 45%.

As per the new scheme, a taxpayer can make a voluntary disclosure of undisclosed foreign bank account income of up to INR 10 million as on Mar. 31. In case of undisclosed foreign income, a taxpayer can make a declaration for assets up to INR 50 million as on Mar. 31. The finance ministry said the total amount payable at the time of disclosure will include 30% tax on the value of undisclosed assets or foreign income and an amount equal to the tax computed.

After electronic verification of the voluntary declaration, the income-tax authority will communicate the amount payable by way of an order within one month from the end of the month in which the declaration was made. The amount must be paid within two months from the end of the month in which the order is received, the ministry said.

The scheme does not apply when any income or asset directly or indirectly represents proceeds of crime where proceedings have been initiated, or are pending under The Prevention of Money-Laundering Act, 2002 or when any income or asset relates to an assessment year for which assessment proceedings have already been completed under The Black Money Act, 2015.

The tax department has been pushing to eliminate evasion, improve compliance, and boost tax buoyancy. Over the past two years, it has launched various initiatives to nudge taxpayers to declare undisclosed foreign income. Under these campaigns, the department sends communication to select taxpayers after due risk analysis to review, revise, or update their returns that have already been filed.

The government collected additional income tax worth INR 94.94 billion in the financial year 2024-25 (Apr-Mar) and FY26 under its campaign to nudge taxpayers to voluntarily disclose income and file updated income tax returns, Minister of State for Finance Pankaj Chaudhary had said in Parliament earlier this month.  End

Reported by Priyasmita Dutta 

Edited by Rajeev Pai

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