Central Government has recently proposed a foreign asset disclosure scheme as a one‑time amnesty window vide the Finance Bill 2026 (referred to as the Foreign Assets of Small Taxpayers Disclosure Scheme, 2026 or FAST‑DS 2026).
The Scheme lets individual taxpayers voluntarily declare previously undisclosed asset located outside India and undisclosed foreign income and obtain immunity from penalties and prosecution under the Income‑tax Act and the Black Money (Undisclosed Foreign Income and Assets) Imposition of Tax Act, 2015.
Section 115 (1) of the Finance Bill, 2026 provides definition of undisclosed foreign income and undisclosed asset located outside India:
- Undisclosed foreign income refers to total amount of income of an assessee from a source located outside India which was chargeable to tax in India but has not been offered to tax under the Income-tax Act, 1961.
- Undisclosed asset located outside India means an asset (including financial interest in any entity) located outside India, held by the assessee in his name or in respect of which he is a beneficial owner, and he has no explanation about the source of investment in such asset or the explanation given by him, is in the opinion of the Assessing Officer, unsatisfactory
The scheme covers not only residents, but also non-residents and not ordinarily resident Indians, provided they were residents either in the year of earning the income or in the year of acquisition of the foreign asset.
The scheme covers those who hold undisclosed foreign assets (such as overseas bank accounts, stocks, mutual funds, ESOPs/RSUs, immovable property) or foreign‑source income (interest, dividends, capital gains, etc.). Eligibility is limited to individuals (not companies, LLPs, trusts, etc.) with total undisclosed foreign assets up to ₹1 crore (or up to ₹5 crore for assets acquired while non‑resident, subject to a one‑time fee of ₹1 lakh).
The scheme provides for coverage and liability as per below:
| Category | Scope & Eligibility |
Financial Liability
|
| Category A(Evaded Tax) | Undisclosed foreign assets and/or income where the aggregate value does not exceed ₹1 crore. |
60% total outflow:
30% tax on the fair market value of the asset (as of March 31, 2026) or undisclosed income.
100% penalty on the calculated tax amount (an additional 30%).
|
| Category B(Technical Lapse) | a. Asset located outside India acquired from income accruing or arising outside India, by an assessee, during the period in which such assessee was a non-resident, but such assets were not declared by him in the relevant Schedule in the return of income on becoming a resident; or
b. asset located outside India acquired from income which had been offered to tax under Act by assessee, but such assets were not declared by him in the relevant Schedule in the return of income
Asset value does not exceed ₹5 crore. |
Flat fee of ₹1,00,000(One Lakh Rupees).
|
The Central Government is yet to notify the exact start and end dates for this 6-month declaration window in the Official Gazette.
