Foreign assets disclosure scheme 2026: declare by 31 December

Country reference

• Country: India (Wave 1 expansion country)
• Authorities: Income Tax Department; Central Board of Direct Taxes (CBDT)
• Topic: Foreign Assets of Small Taxpayers Disclosure Scheme, 2026
• Key date: Window from 16 August to 31 December 2026; values as at 31 March 2026
• Law: Finance Act, 2026, Chapter IV; Notification No. 114/2026 (14 August 2026)

What the scheme offers

The Finance Act, 2026 created a one-time voluntary disclosure scheme for smaller cases of unreported foreign assets and income. CBDT made it operational with Notification No. 114/2026, which sets the rules, valuation method and forms.

Two categories

• Undisclosed foreign assets or income: aggregate fair market value up to INR 1 crore. Tax of 30% plus an additional amount equal to 100% of that tax.
• Assets acquired from income earned as a non-resident, or from income already taxed in India but not reported in a return: aggregate value up to INR 5 crore. Fixed fee of INR 1 lakh.

Key facts

• Valuation date: 31 March 2026.
• Scheme effective: 16 August 2026.
• Last date to declare: 31 December 2026.
• Forms: Form 1 (declaration), Form 2 (amount payable), Form 3 (proof of payment), Form 4 (certificate).
• A valid declaration and payment give immunity from further tax, penalty and prosecution under the Black Money Act, 2015 for the declared asset or income.

Who should look at it

• Returning non-residents who kept foreign accounts, shares or property and did not report them in Schedule FA.
• Employees with overseas stock plans or pension accounts left out of returns.
• Residents with small foreign bank balances from earlier years abroad.

What to do now

• List all foreign assets held at any time, with values at 31 March 2026.
• Decide which category applies, and compute the cost.
• File well before 31 December.

Our take

For professionals who moved back to India from the Gulf, the INR 1 lakh fee route is a cheap way to fix a reporting gap. Check eligibility with an adviser; the Black Money Act penalties outside the scheme are severe.