India has launched a limited-time tax disclosure scheme allowing small taxpayers to declare undisclosed overseas assets and income without facing penalties, in a bid to widen compliance and formalise offshore holdings.
India has opened a one-off tax amnesty for smaller taxpayers to come clean on certain undisclosed overseas assets and income, as the government seeks to widen compliance without resorting to fresh enforcement action. The Foreign Assets of Small Taxpayers-Disclosure Scheme, or FAST-DS, began accepting online declarations on August 16 and will remain open until December 31, 2026, according to the Income Tax Department and the Central Board of Direct Taxes.
The scheme, announced in the 2026-27 Budget, is aimed at taxpayers who may have overlooked foreign holdings such as dormant bank accounts, shares, insurance policies, employee stock awards or other overseas assets, particularly among returning non-residents and professionals who worked abroad. Under the rules set out by the department, eligible declarations of undisclosed foreign income or assets worth up to ₹1 crore will face a tax charge of 30%, plus an additional amount equal to that tax, effectively taking the levy to 60%. Reuters reported that the measure is designed to bring such assets into the tax net while offering immunity from further penalty and prosecution for valid disclosures.
A separate route is available for foreign assets valued at up to ₹5 crore that were already taxable, or were acquired while the taxpayer was non-resident, but were not reported in the relevant tax return schedule. For that category, Reuters said government details show a flat fee of ₹1 lakh. The department has said the fair market value of any disclosed asset will be assessed as of March 31, 2026, and it has also clarified that income or asset values disclosed under the scheme will not be included in total income under the Income-tax Act, 1961 or the Black Money Act.
The legal framework behind FAST-DS also gives a clearer picture of who can use it and how. According to sections published by the Income Tax Department, the scheme covers people who failed to file a return or filed one without declaring certain overseas income or assets before the scheme took effect. Guidance published by tax specialists says the window was created as a one-time, six-month compliance reset, with the government seeking to encourage voluntary disclosure from smaller taxpayers who may have fallen outside the reporting system rather than targeting large-scale evasion.
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