CBDT Rolls Out NUDGE Drive To Catch Undisclosed Foreign Assets; How To Report Yours Correctly

CBDT Rolls Out NUDGE Drive To Catch Undisclosed Foreign Assets; How To Report Yours Correctly

How To Report Foreign Income: Starting November 28, 2025, Indian taxpayers who have foreign assets are receiving SMSs and emails from the tax department for voluntary disclosure and file revised ITRs by December 31, 2025, if not done properly. The Central Board of Direct Taxes (CBDT) has launched the second phase of NUDGE (Non-intrusive Usage of Data to Guide and Enable), encouraging taxpayers for voluntary compliance.

According to press release of tax department, analysis of AEOI information for FY 2024-25 (CY 2024) has identified high-risk cases where foreign assets appear to exist but have not been reported in the ITRs filed for AY 2025-26.

Those who fail to comply with and report foreign assets will face penalties. Taxpayers are advised to review these foreign assets and, where necessary, revise their ITRs by December 31, 2025, to avoid potential penal consequences.

It aims to facilitate the correct reporting in Schedule Foreign Assets (FA) and Foreign Source Income (FSI) in ITRs. Accurate and complete disclosure of foreign assets and income is a statutory requirement under the Income-tax Act, 1961, and the Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015.

CBDT advises all eligible taxpayers to utilise this opportunity to ensure complete compliance with statutory reporting requirements. For further information on CRS, FATCA, Schedule FA and Schedule FSI, taxpayers may refer to the official website www.incometax.gov.in.

If you are an Indian resident and you hold any foreign asset, you must report it in your Income Tax Return, even if the asset doesn't give you any income.

You must report if you have:

To report foreign assets, you must use:

A. Schedule FA (Foreign Assets)

This schedule captures asset details for the calendar year (January to December), not the financial year.

You must fill:

B. Schedule FSI (Foreign Source Income)

Report income earned from:

You must mention:

C. Schedule TR (Tax Relief)

If you paid tax abroad, you can claim relief under:

You need:

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Non-reporting of foreign assets can lead to strict penalties under the Black Money Act, including:

Source: News18
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