India Unveils One-Time Tax Amnesty for Small Foreign Asset Disclosures
New Delhi, India – The Indian government has launched a significant one-time tax disclosure scheme, the Foreign Assets of Small Taxpayers–Disclosure Scheme (FAST-DS), aimed at allowing small taxpayers to regularize certain undisclosed foreign assets and income. Announced in the 2026–27 Union Budget by Finance Minister Nirmala Sitharaman, the scheme provides a crucial window for compliance, with declarations accepted until December 31, 2026.
The initiative, officially notified by the Central Board of Direct Taxes (CBDT), began accepting online filings on August 16, 2026. According to the CBDT, FAST-DS "enables eligible taxpayers to declare certain undisclosed foreign assets, undisclosed foreign income, or undeclared foreign assets, on payment of a specified tax or fee." This move is designed to bring eligible overseas holdings into the tax net while offering relief from additional penalties and prosecution.
Key Provisions and Eligibility:
The FAST-DS offers two distinct tracks for taxpayers, catering to different scenarios of undisclosed foreign wealth:
- Undisclosed Foreign Income (up to Rs10 million): For taxpayers with undisclosed foreign income not exceeding Rs10 million (approximately $104,614 USD), the scheme mandates a tax rate of 30%, coupled with an additional amount equivalent to the tax. This effectively results in a 60% levy on the disclosed sum. As reported by Reuters, this aims to address smaller-scale undisclosed income that may have slipped through the cracks.
- Undeclared Foreign Assets (up to Rs50 million) with Prior Taxation/Non-Resident Acquisition: A separate track exists for foreign assets valued up to Rs50 million that have either been previously offered to tax or were acquired when the taxpayer held non-resident status, but were not properly disclosed in the relevant schedule of their income tax return. In such instances, taxpayers can regularize their position by paying a flat fee of Rs100,000. This provision offers a streamlined process for correcting past filing oversights.
The fair market value of assets declared under FAST-DS will be computed as of March 31, 2026.
Immunity and Rationale:
A significant benefit of the FAST-DS is the assurance of immunity. Taxpayers who make valid declarations will be exempt from further tax, penalty, and prosecution under the Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015, for the income or assets disclosed. The CBDT further clarified that the declared income or the amount invested in the disclosed asset will not be added to the taxpayer’s total income under the Income-tax Act, 1961, or the Black Money Act.
This initiative is particularly directed at small taxpayers, including students, young professionals, employees in the technology sector, and non-resident Indians, who may have inadvertently omitted eligible foreign holdings from their filings. The government recognizes that such omissions can occur due to lack of awareness or genuine errors, and the scheme provides a structured pathway to rectify these.
The launch of FAST-DS underscores the Indian government’s commitment to widening the tax base and promoting transparency in financial dealings, particularly concerning overseas assets. By offering a limited amnesty with a clear deadline, authorities aim to encourage voluntary compliance and bring previously undeclared foreign holdings into the formal economy. Taxpayers considering this scheme are encouraged to consult with tax professionals to understand its full implications and ensure accurate declarations within the stipulated timeframe. More information about the scheme can be found here.
