The Income Tax Department has put certain taxpayers on its radar. These identified individuals will begin receiving SMS and emails from November 28, advising them to file revised income tax returns by December 31, 2025, to avoid penal action.
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ITR notice: The Income Tax Department has put some taxpayers on its radar. These are the taxpayers who have not disclosed their foreign assets in their ITR. The Income Tax Department said that high-risk cases of around 25,000 taxpayers have been identified in which they have not disclosed details of foreign assets in their Income Tax Returns. SMS and emails will be sent to these identified people from November 28, advising them to file revised Income Tax Returns by December 31, 2025, to avoid penal action. The scope will be expanded to include other cases in the second phase of the campaign starting from mid-December.
Notices were also sent last year
It should be noted that last year, under the Automatic Exchange of Information (AEOI) system, the Income Tax Department sent messages to taxpayers reported by foreign jurisdictions who had not disclosed details of their foreign investments and accounts in their ITRs. This initiative resulted in a total of 24,678 taxpayers amending their returns and disclosing foreign assets worth Rs 29,208 crore and foreign income worth Rs 1,089.88 crore.
Large Companies Also Involved
News agency PTI sources said that large companies whose employees possess foreign assets but have not disclosed them have also been included in this initiative. Industry organizations, the ICAI, and various associations have also been requested to spread awareness about this. The department said in a statement that analysis of AEOI information for the financial year 2024-25 has revealed several cases where foreign assets are likely to be held but have not been disclosed in the ITR filed for the assessment year 2025-26.
Under which Act is the information obtained?
The Central Board of Direct Taxes (CBDT) receives information on foreign financial assets of Indian residents through information-sharing systems—the Common Reporting Standard (CRS) and the US Foreign Account Tax Compliance Act. This information helps identify potential errors in returns and guide taxpayers towards proper compliance. The objective of this campaign is to ensure accurate and complete disclosure of information under the Foreign Assets (FA) and Foreign Source Income (FSI) sections in the ITR.
Accurate disclosure of foreign assets and foreign source income is legally mandated under the Income Tax Act, 1961, and the Black Money Act, 2015. Under the Black Money Act, failure to disclose foreign assets attracts a 30% tax, a penalty of 300% of the tax payable, and a fine of up to ₹10 lakh.
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