The Income Tax department has sent SMS alerts to thousands of taxpayers, asking them to review and correct their foreign asset disclosures before July 31. The alerts follow a data-matching exercise where the IT portal compared what people had declared about overseas holdings, bank accounts, and property with information received from foreign tax authorities and international financial institutions.
Taxpayers who receive these alerts can now see detailed comparisons on the IT portal showing what they declared in previous years versus what foreign countries have reported about them. The discrepancies range from incomplete bank account details to undisclosed property or unreported foreign income. For minor mismatches, taxpayers can make corrections through a straightforward process. But significant gaps require filing an amended return, which can trigger closer examination by tax officials.
The July 31 deadline is firm. After this date, the IT department will treat missing or incorrect disclosures as deliberate misstatement, inviting penalties. Repeat non-disclosure of foreign assets can lead to prosecution under the Black Money Act. This pushes many taxpayers who have delayed corrections into action now, scrambling to update their filings before consequences deepen.
This exercise reveals how extensively the IT department monitors overseas holdings. Through international tax information-sharing agreements, India receives regular updates on accounts held by Indian citizens at foreign banks, property ownership in countries like the US and UK, and income declared to foreign tax authorities. What was once hidden from Indian tax records is now systematically collected and matched against individual declarations.
For Indians with foreign assets, the implication is significant. The traditional assumption that foreign holdings remain private or beyond the reach of Indian authorities no longer holds. Banks globally now share account holder information with tax authorities. Property records are searchable across jurisdictions. Income reported overseas is tracked and compared.
The current exercise is routine tax compliance. But it establishes a critical fact: the tax system now has near-real-time visibility into overseas holdings of Indian taxpayers. Anyone who has not fully and accurately disclosed foreign assets should treat this deadline as final notice. After July 31, the cost of correction rises sharply. The window to fix discrepancies quietly has narrowed to weeks.
Source: ET Economy
