FAST, not furious: Amnesty on hidden foreign assets in Budget 2026

In a bid to resoluteness long-pending cases of inadvertent overseas plus non-disclosures and to promote voluntary compliance, the Budget has projected a caller amnesty model for tiny taxpayers, alongside a relaxation of prosecution norms nether the Black Money law.Under the projected Foreign Assets of Small Taxpayers – Disclosure Scheme, 2026 (FAST-DS 2026), nonmigratory taxpayers volition get a time-bound accidental to state undisclosed overseas income and assets, astir a decennary aft the one-time compliance model offered successful 2015. According to the explanatory memorandum, non-compliance continues to persist, particularly successful bequest cases involving ESOPs from overseas employment, dormant overseas slope accounts of erstwhile students, security oregon savings of returning non-residents, and assets held during overseas deputations.

The strategy introduces a graded framework. Taxpayers who neither disclosed overseas income nor assets earlier — with aggregate undisclosed income oregon plus worth up to Rs 1 crore — volition beryllium required to wage 30% taxation connected the just marketplace worth oregon undisclosed income, on with an further 30% levy successful lieu of penalty, successful speech for immunity from prosecution.A 2nd class covers cases wherever income was disclosed oregon taxation paid but the overseas plus itself was not declared.

For specified taxpayers, immunity from some punishment and prosecution volition beryllium disposable connected outgo of a level Rs 1 lakh fee, provided the plus worth does not transcend Rs 5 crore.Sandeep Bhalla, spouse astatine Dhruva Advisors, said, “The amnesty is simply a spot half-hearted. There is nary crushed for a bounds of Rs 5 crore successful a lawsuit wherever either the Indian taxation is paid successful afloat oregon the plus was earned during non-residency of the taxpayer. In some cases, specified overseas income oregon plus would not beryllium taxable successful India successful immoderate case.

Similarly, adjacent successful cases wherever taxation of 30% positive punishment of 30% is being collected, determination was nary crushed to bounds specified disclosures to Rs 1 crore.

There is simply a request for overseas speech to travel successful and go portion of the system.”Separately, the govt has besides projected easing prosecution provisions nether the Black Money Act for insignificant non-disclosures. Residents volition nary longer look transgression enactment for overseas assets (other than immovable property) wherever the aggregate worth does not transcend Rs 20 lakh. This alteration volition use retrospectively from Oct 1, 2024.