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The Income Tax department will start sending SMS/emails to about 25,000 individuals, who are part of the “high-risk” cases identified for non-disclosure of foreign assets in the income tax returns (ITRs) filed for Assessment Year (AY) 2025-26, sources said.
Illustration: Dominic Xavier/Rediff
The “high-risk” cases have been identified on the basis of information received from foreign jurisdictions under the Automatic Exchange of Information (AEOI) framework.
As part of the ‘nudge’ campaign, the Central Board of Direct Taxes (CBDT) in the first phase will target 25,000 ‘high-risk’ cases by sending SMS/emails, asking them to file revised ITR by December 31, 2025, to avoid penal consequences.
In the second phase, starting from mid-December, the NUDGE campaign would be expanded to cover other cases as well to improve the compliance ecosystem.
Big corporates whose employees have foreign assets and have not disclosed are also onboarded to sensitise taxpayers, sources said, adding industry bodies, ICAI, and associations have also been requested to create awareness.
Separately, the I-T department in a statement said: “Analysis of AEOI information for FY 2024-25 (CY 2024) has identified high-risk cases where foreign assets appear to exist but have not been reported in the ITRs filed for AY 2025-26.”
Black Money Act prescribes a penalty of Rs 10 lakh for non-disclosure of foreign assets apart from a tax of 30 per cent and a penalty of 300 per cent on the tax payable.
Last year, too, the department had sent SMS/emails to targeted select taxpayers who had been reported by foreign jurisdictions under the Automatic Exchange of Information (AEOI) framework as holding foreign assets that were not disclosed in their Income Tax Returns (ITRs) for AY 2024-25.
This ‘nudge’ initiative led to 24,678 taxpayers (including several who were not sent SMS/emails) revisiting their ITRs and disclosing foreign assets amounting to Rs 29,208 crore, along with foreign-source income of Rs 1,089.88 crore, in AY 2024-25.
According to sources, till June 2025, the income tax department has assessed about 1,080 cases, raising the demand of Rs 40,000 crore.
They also said that the department has already conducted searches in Delhi, Mumbai and Pune, based on data received under CRS and spontaneous exchange of information on investments in Dubai, unearthing undisclosed foreign assets and income worth several hundreds of crores.
The Central Board of Direct Taxes (CBDT) receives information relating to foreign financial assets of Indian residents from partner jurisdictions pursuant to Common Reporting Standards (CRS) and from the United States under the Foreign Account Tax Compliance Act (FATCA).
This information assists in identifying potential discrepancies and guiding taxpayers towards timely and accurate compliance, it added.
The campaign aims to facilitate correct reporting in Schedule Foreign Assets (FA) and Foreign Source Income (FSI) in ITRs.
Accurate disclosure of foreign assets and income is a statutory requirement under the Income-tax Act, 1961, and the Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015.
