The Central Board of Direct Taxes (CBDT) has introduced a one-time scheme for small taxpayers to declare undisclosed foreign assets until December 2026. This move aims to encourage taxpayers to come forward and disclose their foreign income and assets, thereby avoiding potential penalties. Under the scheme, taxpayers will have to pay 60% of the declared value of their foreign assets to ensure immunity from penalties. The CBDT's move is significant for Indian investors, especially those with foreign income or assets.
It provides an opportunity for taxpayers to regularize their foreign income and assets, which may have gone unreported. This scheme is also expected to boost investor confidence in the Indian economy, which has been performing well in recent years. The Nifty and Sensex, key Indian stock market indices, have been trading at record highs, and this move is expected to further boost investor sentiment. The scheme is open to small taxpayers, who have income up to ₹50 lakhs and foreign assets up to ₹25 lakhs.
Taxpayers who have already paid taxes on their foreign income will not be eligible for the scheme. The CBDT has made it clear that this is a one-time opportunity for taxpayers to come forward and declare their foreign income and assets without facing any penalties. With this scheme, the CBDT aims to increase tax compliance and reduce the risk of tax evasion among small taxpayers.