If you have a foreign bank account, property, investment or income that should have been reported in your income-tax return but was missed, there is now a one-time opportunity to disclose it.
The Central Board of Direct Taxes (CBDT) has notified the Foreign Assets of Small Taxpayers–Disclosure Scheme (FAST-DS), 2026. It has also issued detailed FAQs explaining the scheme and how taxpayers can use it.
It , “Central Board of Direct Taxes (CBDT) has notified the Foreign Assets of Small Taxpayers-Disclosure Scheme (FAST-DS) Rules, 2026.”
The scheme came into effect on August 16, 2026. Taxpayers can file declarations until December 31, 2026, and the entire process will be online.
The Income Tax Department said the FAQs have been issued to help taxpayers and other stakeholders understand the scheme and its rules.
The scheme covers residents, non-residents and resident but not ordinarily resident (RNOR) taxpayers, subject to the conditions laid down under the scheme.
A taxpayer can make a declaration if they were a resident of India in the year to which the undisclosed income relates or in the year in which the foreign asset was acquired.
The scheme applies where a taxpayer did not file an income-tax return, filed a return but left out the relevant foreign asset or income, or where the asset or income could otherwise be treated as having escaped assessment.
The declaration has to be filed electronically in Form 1 between August 16 and December 31, 2026. It can cover previous years, subject to the monetary limits under the scheme.
There is an important difference between foreign income that was never offered to tax and a foreign asset that was not reported even though the related income had already been taxed.
In the first case, FAST-DS covers undisclosed foreign income or assets with an aggregate value of up to Rs 1 crore.
The taxpayer has to pay tax at 30%, along with an additional amount equal to 100% of the tax. This effectively takes the total payment to 60% of the amount declared.
The second category is meant for taxpayers who have already offered the income related to a foreign asset to tax but failed to disclose the asset in the relevant schedule of their income-tax return.
It also covers certain foreign assets acquired when the taxpayer was a non-resident, subject to the conditions of the scheme.
Under this category, the aggregate value of foreign assets can be up to Rs 5 crore. The taxpayer has to pay a flat fee of Rs 1 lakh.
If the total value of the foreign assets is more than Rs 5 crore, the taxpayer cannot use this category of FAST-DS.
This distinction is important because someone who has already paid tax on the income but simply forgot to report the foreign asset faces a very different payment requirement.
The valuation date for foreign assets under FAST-DS is March 31, 2026.
The rules prescribe different methods for valuing foreign bank accounts, shares and securities, jewellery and immovable property. The value ultimately has to be reported in Indian rupees.
Taxpayers have to file Form 1 electronically along with the required supporting documents. A valuation report will also be needed wherever applicable. Multiple assets or income items can be included in the same form.
After verification, the tax authority will communicate the amount payable through Form 2.
The taxpayer normally gets two months from the end of the month in which the order is received to make the payment. A further period of up to two months is available, with simple interest of 1 per cent for every month or part of a month of delay.
Once a valid declaration is made and the required payment is completed, the taxpayer gets immunity from further tax or penalty and prosecution under the Black Money Act, 2015, for the income or asset covered by the declaration.
However, FAST-DS does not apply to certain cases. These include specified income or assets linked to proceeds of crime where proceedings have been initiated or are pending under the Prevention of Money-laundering Act.
The scheme also does not cover cases where assessment proceedings for the relevant year have already been completed under the Black Money Act.
For anyone who missed reporting a foreign asset or income, the first step is to understand which of the two FAST-DS categories applies.
If the foreign income or asset was never offered to tax, the Rs 1 crore limit and the 60% effective payment apply. If the income was already taxed but the foreign asset was not disclosed, the limit is Rs 5 crore and the applicable payment is a flat Rs 1 lakh fee.
The one-time window to make a declaration is open from August 16 to December 31, 2026.