Income-tax department nudges UAE property owners to disclose undeclared assets

Around 1,100 taxpayers have applied under the one-time FAST-DS scheme, which offers eligible people a chance to regularise undisclosed foreign assets and income

The Income-Tax Department has analysed details received from multiple sources about people owning undeclared properties abroad and recently “nudged select taxpayers” who have invested in residential or commercial properties in the United Arab Emirates (UAE), people aware of the development said.

The scheme offers immunity from further assessment, penalties and prosecution under the Black Money Act for valid declarations. (Unsplash/Representational)

This exercise is part of the central government’s initiative, the Foreign Assets of Small Taxpayers — Disclosure Scheme, 2026 (FAST-DS), offering a one-time opportunity to disclose foreign assets and income hitherto undisclosed.

The one-time voluntary disclosure scheme, launched on August 16, enables eligible taxpayers to declare certain undisclosed foreign assets, undisclosed foreign income, or undeclared foreign assets, upon payment of a specified tax or fee. The last date for the scheme was December 31, 2026. Till now approximately 1,100 taxpayers have filed applications under the scheme, they said requesting anonymity.

E-filing portal provides foreign asset information for 2022-2024

In order to facilitate taxpayers, the I-T department has created facility in the e-filing portal where a taxpayer can see information with respect to assets reported on their permanent account numbers (PANs) by the foreign jurisdictions, under Automatic Exchange of Information (AEOI) popularly known as the Foreign Account Tax Compliance Act (FATCA) and Common Reporting Standard (CRS), they said. “Taxpayers can log in to the e-filing portal and download this information for three year 2022-2024,” one of them said. The information received under AEOI from the signatories of CRS/FATCA frameworks has only been displayed in the e-filing portal.

The department also receives information under other multilateral frameworks which have not been displayed in the portal due to various risk factors or non-disclosure commitments. Further Department collect information or intelligence from other sources as well, he said.

At a high-level meeting on October 23, the department decided that such information may also be shared with relevant taxpayers, wherever possible, to enable them take advantage of the Scheme. “The Department has recently nudged select taxpayers who have invested in residential or commercial properties in a country in UAE,” he added.

CBDT sets up committees to address taxpayer queries

The department has also planned outreach programmes to create awareness among taxpayers, corporates as employers, educational institutes, professional bodies and industry associations, he said. The Central Board of Direct Taxes (CBDT) has also made a committee in each region under principal chief commissioner to help taxpayers resolve their queries and concerns, he said.

The scheme provides a time-bound window to regularise eligible disclosures by paying 30% tax on the fair market value and equal amount of penalty in addition to tax.

An important feature of the scheme is that it is fully online, trust-based and self-declaratory, he said. A valid declaration brings immunity from further assessment, penalty and prosecution under the Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015 (Black Money Act), he added. The scheme further provides opportunity to the taxpayers to report accounted assets and income on payment of ₹1 lakh fee to avoid penalty of ₹10 lakh each year prescribed in the Black Money Act, he said.