Centre May Launch One-Time Foreign Asset Disclosure Scheme For Small Taxpayers

The Centre is likely to introduce a one-time compliance window from August 15 for resident taxpayers who failed to disclose foreign bank accounts, assets or income in their tax filings.

According to a report by Moneycontrol, the Foreign Assets of Small Taxpayers Disclosure Scheme (FAST-DS), 2026, is expected to be formally notified this week.

The scheme will allow eligible taxpayers to voluntarily report past omissions until December 31. The government aims to provide an opportunity for genuine taxpayers to correct mistakes while avoiding strict consequences applicable under the Black Money Act.

Scheme Limited To Small Foreign Asset Cases

The proposed compliance scheme has been designed with specific limits to ensure that it benefits only smaller taxpayers and does not become an avenue for holders of large undisclosed offshore wealth.

According to government sources, FAST-DS will apply to cases involving undisclosed foreign income of up to Rs 1 crore or foreign assets valued at up to Rs 5 crore, subject to conditions prescribed under the law.

A senior government official said the objective is to provide relief in relatively small cases and encourage voluntary compliance. The scheme is not intended to offer immunity to individuals with substantial undisclosed overseas holdings.

The official added that the initiative provides taxpayers with a fresh opportunity to transparently correct reporting errors related to foreign assets and income.

Background And Black Money Act Penalties

Finance Minister Nirmala Sitharaman announced FAST-DS while presenting the Union Budget on February 1. The scheme was introduced through the Finance Bill as part of the new Income-tax Act, 2025, but its implementation date was left to be notified separately.

Under existing provisions of the Black Money Act, failure to disclose foreign assets can attract penalties of up to Rs 10 lakh per asset for each year of non-reporting.

The move comes after the Central Board of Direct Taxes (CBDT) identified more than 25,000 taxpayers as high-risk cases for possible non-disclosure of foreign assets and income for financial year 2024-25.