In September last year, India received financial information from over 108 countries regarding foreign accounts and income in the form of interest and dividend earned outside India.
Kindly note the image has been posted only for representational purposes. Photograph: Kind courtesy Steve Buissinne/Pixabay.com
Upon prodding from the Income-Tax Department, more than 30,000 taxpayers have declared foreign assets worth Rs 29,208 crore (Rs 292.08 billion) and additional foreign income of Rs 1,090 crore (Rs 10,90 billion) for assessment year (AY) 2024-2025, according to Central Board of Direct Taxes (CBDT) officials.
In September last year, India received financial information from over 108 countries regarding foreign accounts and income in the form of interest and dividend earned outside India.
Using this data received under the automatic exchange of information, the CBDT launched a ‘compliance-cum-awareness campaign’ on November 17, urging taxpayers to declare their foreign assets and income in revised income-tax returns (ITRs) for AY 2024-2025.
As a result of this campaign, 6,734 taxpayers revised their residential status from ‘resident’ to non-resident’.
“The campaign yielded significant results with 24,678 taxpayers reviewing their ITRs and 5,483 taxpayers filing their belated returns for AY 2024-2025,” an official said.
At the heart of this campaign lay the government’s “trust first” approach, which prioritises voluntary compliance over enforcement, the official said.
“Instead of immediate verification or intrusive actions, the department has trusted taxpayers first, giving them ample opportunity to make true and complete disclosures of their foreign income and assets,” the official added.
The CBDT had sent SMS and e-mails to 19,501 taxpayers with a high foreign account balance or significant foreign income from interest or dividend above a threshold, urging them to revise their ITRs for reporting foreign assets and income.
“Additionally 30 outreach sessions, seminars, and Webinars were conducted across India, engaging over 8,500 participants directly. Pamphlets, brochures and elaborate samvaad sessions on social media further amplified awareness,” the official said.
Approximately 62 per cent of the taxpayers who got a nudge responded positively, voluntarily revising their ITRs.
The number of taxpayers disclosing foreign assets and income voluntarily has grown from 60,000 in AY 2021-2022 to 231,452 in AY 2024-2025.
This year, due to an extensive outreach and awareness efforts, voluntary disclosures witnessed 45.17 per cent growth compared to AY 2023-2024.
India is a participant in initiatives on global tax transparency, particularly through the Common Reporting Standard (CRS) and the Foreign Account Tax Compliance Act (Fatca).
These frameworks help combat offshore tax evasion by ensuring an automatic exchange of information on financial accounts among countries.
The country is an early adopter of the CRS, implemented by the Organisation for Economic Co-operation and Development, to exchange financial information with other jurisdictions.
Feature Presentation: Ashish Narsale/Rediff.com
