Attention taxpayers! Disclose foreign income ASAP or hefty face penalty
The Income Tax Department has reminded taxpayers to disclose any undisclosed foreign income or assets before the year ends. The last date to file a revised return for such disclosures is December 31. Failure to comply could lead to a penalty of ₹10 lakh. The move is aimed at ensuring full transparency in reporting all foreign assets and income, and avoiding penalties or legal action under the Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015.
Revised return: A chance to rectify omissions
The Income Tax Department has clarified that taxpayers who failed to disclose their foreign assets and income in their original ITR, now have a chance to correct it by filing a revised return. The department permits taxpayers to correct any omissions or inaccuracies this way. "For the A.Y.2024-25 revised return can be filed up to 31.12.2024," said the department in its recent announcement.
Procedure to report foreign income and assets
To report foreign assets, taxpayers must fill out Schedule FA (Foreign Assets) in their income tax form. Income from foreign sources must be reported in Schedule FSI (Foreign Source Income) of the relevant tax form. Taxpayers can also claim relief on taxes paid abroad by filing Schedule TR (Tax Relief). This procedure ensures accurate reporting of all foreign income and assets, thus avoiding potential penalties or legal consequences.
Who qualifies as a resident taxpayer?
A resident taxpayer is someone who has lived in India for 182 days or more during the previous year or has stayed here for 365 days in the last four years. Those who don't fall under these categories are non-residents or not ordinarily residents, and are not required to declare foreign income and assets. This distinction is important to know who needs to declare foreign income/assets by December 31.
