Tax department's compliance nudge results in 30,161 taxpayers declaring foreign assets worth Rs 29,000 crore

CBDT launched the compliance initiative on 17 November 2024

As many as 30,161 taxpayers voluntarily declared foreign assets worth Rs 29,208 crore and foreign income of Rs 1,089.88 crore for the Assessment Year (AY) 2024-25, as part of a special campaign, government sources told Moneycontrol on March 6.

The declarations came as part of the Central Board of Direct Taxes’ (CBDT) Compliance-Cum-Awareness Campaign, aimed at encouraging voluntary disclosures of offshore wealth and income.

CBDT’s data-driven and non-intrusive approach led to a surge in voluntary disclosures. Of the 30,161 taxpayers who declared their offshore wealth, 5,483 filed belated ITRs, while others revised existing filings. Additionally, 6,734 individuals updated their residential status from Resident to Non-Resident, the source informed.

CBDT launched the compliance initiative on 17 November 2024, urging taxpayers to voluntarily disclose foreign assets and income in revised Income Tax Returns (ITRs). The campaign focused on transparency and education, ensuring taxpayers understood their reporting obligations.

The number of taxpayers voluntarily disclosing foreign assets has risen sharply over the years - from 60,000 in AY 2021-22 to more than 2.31 lakh in AY 2024-25. Compared to AY 2023-24, voluntary disclosures grew by 45.17 percent, reflecting an increased awareness as well as compliance.

The Income Tax Department reached out to 19,501 taxpayers via SMS and email, flagging high-value foreign accounts or significant overseas income. Additionally, 30 outreach sessions, seminars, and webinars were conducted, engaging over 8,500 participants. Social media campaigns, brochures, and explanatory materials further simplified compliance procedures.

India, an early adopter of the Common Reporting Standard (CRS), has been receiving data on individual overseas financial assets and income since 2018.

In September 2024, the country obtained information from over 108 jurisdictions, detailing foreign accounts, balances, and income such as interest and dividends. The information exchange also occurs under the Foreign Account Tax Compliance Act (FATCA) agreement with the United States.