NRIs must disclose foreign bank accounts in Indian I-T returns
A new provision has been added to the tax return form (ITR2) by income-tax authorities requiring all non-residential Indians (NRI) to disclose the details of their bank accounts outside India. Previously, NRIs could escape the tax net by claiming funds lying in foreign bank accounts as lawful income earned abroad. But now, this won't be that easy.
What has changed?
Thousands of NRIs file tax returns to disclose the income from stocks, rentals, real estate trade, bank deposits and bonds in India. However, they don't disclose their foreign bank accounts. But starting this year, they will have to disclose account numbers of their foreign bank accounts, bank names, location, SWIFT codes and the separate International Bank Account Numbers (IBAN).
NRIs not disclosing information risk greater scrutiny by tax authorities
Under the new measure, if NRI taxpayers hold back information on their foreign accounts, they risk being questioned by Indian tax authorities in the future if they come across information on undisclosed funds or black money. With tax havens more open to sharing data with India, such a possibility is more likely. Non-disclosures could attract action by the Enforcement Directorate for possible money-laundering.
Indian black money stashed in Swiss banks declines
The latest measure comes amid reports that the amount of money stashed by Indians in Swiss banks has halved to Rs. 4,500 crore in 2016, a record low. This is a result of the Indian government's continued crackdown on suspected black money kept abroad.
