Failure to disclose foreign assets, income to invite ₹10L penalty: I-T dept

CBDT launches compliance campaign for taxpayers to report foreign assets in ITR, warns of ₹10 lakh penalty for non-disclosure.

The Income-Tax Department on Sunday (November 17, 2024) cautioned taxpayers that failure to disclose assets held abroad or income earned in foreign shores in the ITR can attract a penalty of ₹10 lakh under the anti-black money law.

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The department issued a public advisory as part of a compliance-cum-awareness campaign launched recently by it on Saturday (November 16, 2024) to ensure that such information is reported by the assessee in their Income Tax Return (ITR) for assessment year (AY) 2024-25.

The advisory specified that foreign asset, for a tax resident of India in the previous year, includes bank accounts, cash value insurance contracts or annuity contracts, financial interest in any entity or business, immovable property, custodial account, equity and debt interest, trusts in which a person is a trustee, beneficiary of settlor, accounts with singing authority, any capital asset etc., held abroad.

The department said taxpayers figuring under this criteria "must mandatorily" fill the foreign asset (FA) or foreign source income (FSI) schedule in their ITR even if their income is "below the taxable limit" or the asset abroad was "acquired from disclosed sources."

"Failure to disclose foreign asset/income in the ITR can attract a penalty of Rs 10 lakh under the Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015," the advisory stated.

The Central Board of Direct Taxes (CBDT), the administrative body for the tax department, had said that as part of the campaign it will send "informational" SMS and email to those resident taxpayers who have already filed their ITR for AY 2024-25.