Steps to Respond to the Income Tax Department’s Notice on Foreign Asset Disclosure

Received a notice about undisclosed foreign assets or income? Here’s what you should do:

1. Review Your Financial Records: Identify and verify any foreign assets or income, like bank accounts, interest, or dividends.

2. Revise Your Tax Return: File a revised ITR for AY 2024-25 by 31 December 2024, reporting all foreign assets under Schedule Foreign Assets.

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Timely action is crucial to avoid penalties or legal action. Stay compliant and secure.

Notice Read as:

Dear ( Taxpayer)

As part of ongoing collaborative efforts to ensure compliance with tax regulations, we have received information concerning foreign assets and income, from the USA, such as Bank account, interest, dividends, etc, that may be associated with you. Our records show that Schedule Foreign Assets has not been filled in your return for AY 2024-25.

Under the provisions of Income-tax Act, 1961, taxpayers are required to disclose their foreign assets and income in their Income-tax return. Any non-disclosure of foreign income or assets may cause initiation of proceedings for assessment, imposition of penalties and or for

prosecution under the Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015.

Accuracy in reporting for tax purpose is important. We urge you to review and revise your income tax return to ensure it reflects all relevant information, including any foreign assets or income you may have held or earned during the relevant financial year. Due date for filing revised return of income for AY 2024-25 is 31 December 2024.

For more information, click on the following link.

(Enhancing Tax Transparency on Foreign Assets & Income: Understanding _CRS & FATCA)

We appreciate your attention to this matter and your commitment to fulfilling your tax obligations.

Warm regards,

Income Tax Department