India has introduced the Foreign Assets of Small Taxpayers Disclosure Scheme (FAST-DS), 2026, offering a one-time opportunity for eligible individuals to declare previously undisclosed foreign assets or income. While the scheme aims to bring transparency, taxpayers considering this route for assets or income up to ₹1 crore must be aware of a potentially significant cost: a total payment that could reach 60% of the declared value under one specific category.
Understanding the FAST-DS 2026 Scheme
The FAST-DS 2026 scheme is a voluntary disclosure initiative that comes into effect on August 16, 2026, with declarations accepted until December 31, 2026. It targets various taxpayers, including:
- Eligible residents for the relevant previous year.
- Certain non-residents (NRs) and Residents Not Ordinarily Resident (RNORs) who were Indian residents during the year the foreign income arose or the asset was acquired.
Declarations are applicable in cases where a taxpayer did not file a return, failed to disclose foreign assets or income in a filed return, or where such income or assets have escaped assessment.
How the 60% Payment is Calculated
For the primary category under FAST-DS, which covers undisclosed foreign assets or income not previously offered to tax, the aggregate value of which does not exceed ₹1 crore, the total amount payable comprises two components:
- Tax: A 30% tax on the declared value of the undisclosed asset or foreign income.
- Additional Amount: An amount equal to 100% of the calculated tax, effectively another 30% of the declared value.
Combined, these two components result in a total payment of 60% of the declared undisclosed value. For instance, if an eligible taxpayer declares an undisclosed foreign asset worth ₹1 crore, the basic tax would be ₹30 lakh (30%). An additional amount of ₹30 lakh would also be payable, bringing the total to ₹60 lakh.
For a ₹1 crore undisclosed foreign asset, the total payment under FAST-DS could be ₹60 lakh.
The same calculation applies to undisclosed foreign income. If a taxpayer declares ₹20 lakh of undisclosed foreign income, the tax would be ₹6 lakh, and the additional amount would also be ₹6 lakh, making the total payable ₹12 lakh.
Key Thresholds and Other Provisions
It's crucial to note that the ₹1 crore limit applies specifically to the aggregate value of undisclosed foreign assets and foreign income under this particular category of the scheme. Taxpayers should also be aware of a separate category within FAST-DS:
- This category addresses certain foreign assets that were either already offered to tax or acquired while the taxpayer was a non-resident but were not reported in the relevant return schedule.
- It features a higher threshold of ₹5 crore and involves a flat fee of ₹1 lakh, subject to the scheme's specific conditions.
The valuation date for assets declared under FAST-DS is March 31, 2026, with the scheme specifying distinct methods for determining the fair market value of various foreign asset types. Taxpayers considering participation should carefully review the scheme's provisions to understand their specific obligations and potential costs.