The government is expected to roll out the Foreign Assets of Small Taxpayers Disclosure Scheme (FAST-DS) from July 1, 2026, offering resident Indians an opportunity to voluntarily disclose foreign assets and income that were not reported earlier.
According to official sources cited by NDTV Profit, the scheme will remain open for six months and is aimed at encouraging tax compliance while providing relief from prosecution and penalties under the Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act.
The scheme was announced in the Union Budget 2026 and is expected to focus on smaller taxpayers rather than high-net-worth individuals.
A compliance window for smaller taxpayers
FAST-DS is designed to help taxpayers regularise overseas assets that may have been omitted from tax filings due to reporting lapses.
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The scheme is expected to benefit a wide range of individuals, including professionals holding foreign Employee Stock Ownership Plans (ESOPs), students who maintained overseas bank accounts during their studies, and returning Non-Resident Indians (NRIs) who may have failed to disclose foreign holdings after becoming tax residents in India.
Officials believe the initiative will help taxpayers correct past omissions without facing the stringent consequences associated with the Black Money Act.
Two categories of disclosures
The proposed scheme divides disclosures into two categories based on the value of assets and the nature of non-compliance. Under Category 1, undisclosed foreign assets and income worth up to Rs 1 crore can be declared. Such declarations will attract a levy of 60 per cent on the fair market value of the asset.
Category 2 covers foreign asset reporting lapses involving assets valued up to Rs 5 crore where the income had already been disclosed and taxed in India, but the foreign asset itself was not reported. In such cases, taxpayers will be required to pay a one-time fee of Rs 1 lakh.
Both categories are expected to provide protection from prosecution and penalties under the Black Money Act, subject to eligibility conditions.
Relief from prosecution
One of the key features of FAST-DS is the relief it offers from criminal prosecution and steep penalties that may otherwise arise from non-disclosure of foreign assets.
For taxpayers who unintentionally omitted details in Schedule FA (Foreign Assets) while filing income tax returns, the scheme could provide an opportunity to regularise their records without prolonged legal consequences.
Tax experts note that foreign asset disclosures have become an increasingly important area of compliance due to greater information sharing between tax authorities across jurisdictions.
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Window expected till December
According to sources, the disclosure window is likely to remain open until December 31, 2026. This would give taxpayers several months to gather financial records, assess overseas holdings and complete the disclosure process.
The Income Tax Department is expected to issue detailed operational guidelines and eligibility conditions before the scheme comes into effect.
The proposed initiative reflects the government's attempt to improve compliance while offering a limited-time opportunity for taxpayers to correct reporting lapses and bring foreign assets within the tax framework.
FAQs
Q1. What is the Foreign Disclosure Scheme 2026 (FAST-DS)?
FAST-DS is a proposed one-time compliance scheme that will allow resident Indians to voluntarily declare previously undisclosed foreign assets and income while seeking relief from prosecution under the Black Money Act.
Q2. When is the FAST-DS window expected to open?
According to official sources cited in reports, the scheme is expected to begin on July 1, 2026, and remain open until December 31, 2026.
