If you have ever held a foreign bank account, vested RSUs from a foreign employer, or bought overseas shares, and that asset never appeared in your Indian return, this is window that matters.
On 14 August 2026, Government notified rules for Foreign Assets of Small Taxpayers Disclosure Scheme (Notification No. 114/2026), and CBDT published official FAQs. Scheme came into force on 16 August 2026. Declarations can be filed online until 31 December 2026, and not after.
For right person, it turns a Black Money Act exposure into a defined and survivable payment. For wrong person, it is money paid for nothing. Difference comes down to one question: which category you are in.
Why this matters now
Under Black Money Act, an undisclosed foreign asset can be taxed at 30% of its value, and Assessing Officer can add a penalty of three times that tax, taking total to around 120% of asset's value, plus interest. Prosecution is also possible. This applies whether or not you owed any Indian tax on asset.
Detection is no longer manual. Foreign account information received under FATCA and CRS now appears in taxpayers' Annual Information Statements. FAST-DS is a chance to regularise on your own terms before that information is acted on.
Two categories, two very different prices
Category A: undisclosed assets or income. This covers a foreign asset whose source of investment you cannot satisfactorily explain, and foreign income that was taxable in India but never offered to tax, up to ₹1 crore in aggregate. You pay 30% tax plus an additional amount equal to that tax, effectively 60% of value. In CBDT's own example, a ₹60 lakh foreign bank account plus ₹20 lakh of foreign income comes to ₹80 lakh, so payment is ₹24 lakh of tax plus ₹24 lakh additional: ₹48 lakh.
Category B: legitimate assets that were never declared. This covers foreign assets that were already offered to tax, or were acquired while you were non-resident, but were not declared in relevant schedule of your return. Payment is a flat ₹1 lakh, provided aggregate value of assets does not exceed ₹5 crore. Above ₹5 crore, this category is not available at all.
Same foreign account can cost ₹1 lakh or 60% of its value. Category decides which.
This distinction matters most for returning NRIs. Savings built from income earned abroad while non-resident, kept after moving back, and never declared once you became ordinarily resident, can fall in Category B rather than Category A.
First, check whether you need it at all
While you are a non-resident or not ordinarily resident, foreign asset disclosure in your Indian return does not apply. Obligation begins in year you become a resident and ordinarily resident. From that year on, every foreign asset you hold must be reported, including assets acquired while you lived abroad. That is where gap usually sits.
If you have been non-resident throughout, or you reported every foreign asset correctly once obligation began, you have nothing to regularise.
Scheme is open to residents. It is also open to people who are now non-resident or not ordinarily resident, if they were resident in year income relates to or year asset was acquired.
Valuation can decide eligibility
Assets are valued as on 31 March 2026, and that value decides whether you stay within ₹1 crore or ₹5 crore ceiling.
For a foreign bank account, value is not balance. It is total of all deposits made since account was opened, excluding money withdrawn and re-deposited into same account, and excluding amounts already declared under Black Money Act. An old salary account with a modest balance today can exceed ₹1 crore on this basis.
For most other assets, value is higher of cost of acquisition and open-market value on 31 March 2026, supported by a recognised valuer's report. Where no valuation is carried out, indexed cost of acquisition is used. For assets other than bank accounts, a difference of up to 20% between your declared value and value later determined will not, by itself, invalidate declaration.
How filing works
Everything is online. You file declaration in Form 1, with documents showing how asset was acquired or income earned, and a valuation report where one is needed. Tax department then issues an order in Form 2 setting out amount payable, within one month from end of month you filed.
Payment is due within two months from end of month you receive that order. It can be made up to two months later with simple interest of 1% for each month of delay; after that, benefit of scheme is lost. You report payment in Form 3, and department certifies it in Form 4. Only declaration must be filed by 31 December; payment follows on this timeline.
Where scheme does not apply
Scheme is not available for income or assets that represent proceeds of crime where proceedings under money-laundering law have been initiated or are pending, or for any year where an assessment under Black Money Act has already been completed. A pending assessment is not a bar: Assessing Officer must take your declaration into account.
What to do before 31 December
Map every foreign account, brokerage, RSU or ESOP holding, property, and insurance policy with cash value. Work out your residential status year by year, so you know exactly when your reporting obligation began. Classify each asset into right category, value it as on 31 March 2026 using scheme's rules, and file with time to spare. Portals slow down near deadlines, and there is no provision for late declarations.
An honest summary
- FAST-DS 2026 is open until 31 December 2026, with no filing after that date.
- Undisclosed assets or income cost 60% of value, up to ₹1 crore. Assets already offered to tax, or acquired while non-resident, but never declared, cost a flat ₹1 lakh, up to ₹5 crore.
- A foreign bank account is valued at total deposits since opening, not its balance.
- If you were non-resident throughout, or reported everything correctly, you do not need scheme.
If you think you may have an undeclared foreign asset, time to act is now, while window is open. Book a consultation, or start by confirming your residency history with our free residency status calculator.
General information, not individual tax advice. FAST-DS 2026 is contained in Chapter IV (sections 130 to 144) of the Finance Act, 2026, read with the Foreign Assets of Small Taxpayers Disclosure Scheme Rules, 2026 (Notification No. 114/2026 dated 14 August 2026) and CBDT's FAQs dated 13 August 2026. Eligibility, valuation, and exclusions depend on your specific facts. Written by Shivam Agrawal, Chartered Accountant, Founder of Tax Salahkars. Last reviewed September 2026.