India launches voluntary disclosure scheme for small taxpayers on foreign assets

The Indian government has launched a new voluntary disclosure scheme allowing small taxpayers to declare undisclosed foreign assets and income by paying a specified tax, aiming to bring overseas holdings into the tax net without further penalties or prosecution. The Foreign Assets of Small Taxpayers Disclosure Scheme, or FASTDS, was notified by the Central Board of Direct Taxes on August 15, 2026, and will take effect from August 16, with online declarations open until December 31, 2026.

The scheme, announced in the 2026-27 Budget, is targeted at taxpayers such as students, young professionals, technology employees, and relocated non-resident Indians who may have failed to properly disclose eligible foreign assets or income. Under the rules, there are two categories for declarations. The first covers undisclosed foreign assets or income not previously offered to tax, with an aggregate value limit of Rs 1 crore. For this category, taxpayers must pay 30% tax on the fair market value of the declared asset or income, plus an additional amount equal to the tax, effectively bringing the total levy to 60%.

The second category applies to foreign assets that were already offered to tax...