Income Tax Department
Many big business families of the country are now under the strict surveillance of the Income Tax Department. Tax officials have identified such families who are accused of not giving complete information about their assets held abroad or the income earned from there in their Income Tax Returns (ITR). Preparations are being made to send notices to these families in the coming time, so that they clarify their tax responsibilities.
According to the information, many business families living in big business cities like Ahmedabad, Surat, Chennai, Hyderabad, Bengaluru and Mumbai are under investigation. Officials say that these families may have assets worth thousands of crores of rupees abroad. Right now the actual data is being prepared by collecting data from different areas. The nodal office of Delhi-based (CBDT) is also investigating some cases.
How do we get information about foreign countries?
The Income Tax Department gets information about foreign bank accounts and assets from other countries. This information is shared under an international system, which has been started by the OECD to prevent tax evasion. This is called Automatic Exchange of Information. Under this, through the Common Reporting Standard, foreign financial institutions give the data of foreign citizens holding accounts there to their government, and it is shared with the concerned country.
In an official statement issued on November 27, it was said that during the analysis of 2024-25, many such high-risk cases came to light, where records of property abroad were found, but it was not mentioned in the ITR of assessment year 2025-26. Now strictness is being increased in such cases.
Next steps for the NUDGE campaign
Last year the department had launched a campaign named NUDGE. In this, such taxpayers were targeted who had information about having foreign assets, but had not shown it in the returns. Following this initiative, thousands of people re-checked their returns and disclosed huge amounts of foreign assets and income.
Now the department is going to start the next phase of this campaign. The notice will not directly name foreign accounts or assets, but taxpayers will be asked to review their disclosures, deposit outstanding taxes and file revised returns, if necessary.
How much tax and penalty will be charged?
According to the existing law, if any foreign asset or income is found hidden, 30 percent tax will be imposed on its value. Apart from this, a fine up to three times the tax amount can also be imposed. There are strict provisions in the laws related to black money, which carry heavy fines along with the risk of litigation.
Relief in the budget, but not for everyone
Recently in the budget, Finance Minister Nirmala Sitharaman has announced a special six-month exemption scheme for small taxpayers, students, young professionals and some NRIs. Under this scheme, the case can be resolved by paying 30 percent tax on undisclosed foreign income or assets up to Rs 1 crore and an additional 30 percent amount, and gets relief from prosecution. However, according to officials, big business families do not come under the scope of this scheme.
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