As many as 30,161 taxpayers voluntarily declared foreign assets worth Rs 29,208 crore for the assessment year (AY) 2024-25 to the Income-tax department under a special campaign launched in November 2024, official sources said.
Under the “compliance-cum-awareness campaign,” the Central Board of Direct Taxes (CBDT) had urged taxpayers to declare their foreign assets and income in revised income tax returns (ITRs).
This campaign followed a system-driven and taxpayer-friendly approach, utilising the information received through ‘common reporting standards’ (CRS) and Foreign Accounts Tax Compliance Act (FATCA).
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While the campaign helped improve compliance, tax experts said severe penalties under the Back Money Act forced many taxpayers to disclose the foreign assets.
The CBDT’s move was in the wake of reports of rising trend of Indians acquiring foreign assets, in part as a measure to evade taxes.
Under the campaign, the tax department has facilitated taxpayers by providing a step-by-step guide to filling schedule foreign assets and schedule foreign source income, along with explanatory materials to help them understand the information received under these frameworks, said the sources.
As part of the campaign, SMS and emails were sent to 19,501 taxpayers with high foreign account balances or significant foreign income from interest or dividends above a specified threshold.
The campaign yielded significant results, with 24,678 taxpayers reviewing their ITRs and 5,483 taxpayers filing belated returns for AY 2024-25, declaring foreign assets worth Rs 29,208 crores and additional foreign income of Rs 1,089.88 crores, they said.
Furthermore, 6,734 taxpayers revised their residential status from resident to non-resident. Overall, approximately 62% of nudged taxpayers responded positively, voluntarily revising their ITRs to declare foreign assets and income, the sources said.
The number of taxpayers disclosing foreign assets and income on a voluntary basis has steadily grown from 60,000 in AY 2021-22 to 2,31,452 taxpayers in AY 2024-25, the sources stated. “This year, due to extensive outreach and awareness efforts, voluntary disclosures witnessed a significant 45.17% growth compared to AY 2023-24.”
At the heart of this campaign lies the Trust First approach, which prioritises voluntary compliance over enforcement. Instead of immediate verification or intrusive actions, the CBDT has trusted taxpayers first, giving them ample opportunity to make true and complete disclosures of their foreign income and assets,
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