I-T radar on senior executives earning over Rs 50 lakh for alleged misuse of exemptions

In the budget for 2026-27, the Centre announced a one-time, six-month window for the declaration of foreign assets to provide relief to taxpayers

• Income Tax dept cracks down on execs for underreporting income
• Notices issued for undeclared foreign assets, crypto income, perks
• Executives asked to revise ITRs or face penalties

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Keeping in line with the government’s broader push for tighter compliance and data-driven enforcement, the Income Tax department has cracked down on a dozen of senior executives  drawing annual salaries of more than Rs 50 lakh for allegedly underreporting their income and claiming unwarranted exemptions.

Senior executives, such as chief executives and managing directors of multinational companies, from sectors such as hospitality, IT, fast-moving consumer goods, engineering and construction, and automobiles have been asked to rectify the anomalies if they don't want penalties in their tax assessment.

According to a report in the Economic Times, the executives have been served notices for failing to declare foreign assets and overseas income, underreporting stock-linked incentives and exaggerating perquisites such as housing and travel allowances to suppress their taxable income.

Officials from the I-T department said business leaders from several startups have also come on the tax department’s radar.  Many taxpayers claimed exemptions by citing fraudulent donations to religious institutions, charitable trusts or educational institutions.

The I-T department unearthed these discrepancies during intense reviews of income tax returns (ITRs) of high-income individuals in the current assessment cycle. As part of its ‘Non-intrusive Usage of Data to Guide and Enable (Nudge)' campaign, the department has asked many executives to file revised ITRs.

A senior official from the I-T department said they come across over two dozen cases where executives invested in expensive properties, more than 50 who received hefty secondary salary payments from foreign clients in cryptocurrencies and cases involving huge donations to political parties that are neither recognised nor contesting elections.

Undisclosed foreign assets included properties purchased in the names of minor children and spouses, foreign stocks, income paid in cryptocurrencies and deposits in overseas accounts.

The official ET quoted also said that they are planning to take action against some Chartered Accountants. “An interesting pattern that emerged was that individuals sharing the same chartered accountants were donating to the same institutions,” said the official.

In the budget for 2026-27, the Centre announced a one-time, six-month window for the declaration of foreign assets to provide relief to taxpayers, including professionals with undisclosed employee stock option plans and students who retained funds in overseas accounts.