FAST-DS 2026: Foreign Assets and Income Disclosure…

The Government has introduced a major one-time compliance opportunity for taxpayers who failed to disclose certain foreign assets or foreign income in their Indian income tax returns.

The scheme is called the Foreign Assets of Small Taxpayers – Disclosure Scheme, 2026 (FAST-DS 2026).

It is particularly relevant for individuals who may have historical foreign bank accounts, overseas investments, RSUs, ESOPs, insurance policies or other foreign assets that were either not taxed in India when required or were not reported in Schedule FA.

FAST-DS 2026 came into force on 16 August 2026, and eligible taxpayers can make a declaration up to 31 December 2026.

Quick answer: FAST-DS 2026 is a time-bound voluntary disclosure route. Eligible taxpayers must identify the correct category, value covered foreign assets as on 31 March 2026 and file Form 1 by 31 December 2026.

FAST-DS Key Dates at a Glance

Milestone	Date / Requirement
Scheme commencement	16 August 2026
Asset valuation date	31 March 2026
Declaration deadline	31 December 2026
Initial filing	Form 1 through the Income Tax e-Filing Portal

What Is FAST-DS 2026?

FAST-DS is a one-time voluntary disclosure scheme enacted under Chapter IV of the Finance Act, 2026.

Its purpose is to allow eligible taxpayers to regularise certain historical non-disclosures relating to foreign income and assets.

The scheme broadly covers two situations:

Foreign income or foreign assets were not disclosed and the related income had not been subjected to Indian tax.
The foreign asset was acquired from already-taxed income or while the person was non-resident, but the asset itself was not correctly disclosed in the Indian income tax return.

The payment and eligibility rules are different for these two categories.

Who Can Benefit from FAST-DS?

The official Budget FAQs specifically identify taxpayers such as:

Employees receiving foreign ESOPs or RSUs;
Former students retaining overseas bank accounts;
Returning NRIs with foreign savings;
Individuals holding foreign insurance policies;
Persons who worked overseas on deputation; and
Other taxpayers who inadvertently failed to report foreign income or assets.

The scheme can also apply in certain cases to a person who is currently non-resident or RNOR, provided that person was resident in India in the relevant period when the foreign income arose or the foreign asset was acquired.

Category 1: Undisclosed Foreign Income or Asset

The first category is for a taxpayer who has:

Undisclosed foreign income; or
An undisclosed asset located outside India,

where the relevant income had not been offered to tax in India.

The aggregate value must not exceed ₹1 crore as on 31 March 2026.

How Much Tax Is Payable?

The taxpayer must pay:

Category 1 payment: 30% tax plus an additional amount equal to 100% of that tax.

Therefore, the total amount payable effectively becomes:

Effective Category 1 payment: 60% of the value of the undisclosed foreign asset or undisclosed foreign income, as applicable.

For example, if an eligible undisclosed foreign asset is valued at ₹50 lakh:

Tax at 30% = ₹15 lakh
Additional amount = ₹15 lakh
Total = ₹30 lakh

After valid declaration and payment, the scheme provides immunity from further tax, penalty and prosecution in respect of the declared income or asset under the covered provisions.

Category 2: Tax Paid but Foreign Asset Not Reported

The second category is significantly different.

It covers certain foreign assets that were:

Acquired from income already offered to tax in India; or
Acquired when the taxpayer was non-resident,

but were not properly disclosed in the relevant return schedule.

A common example could be a returning NRI who acquired an overseas asset while non-resident but later failed to disclose it in Schedule FA after becoming subject to the reporting requirement.

The value of qualifying foreign assets under this category must not exceed ₹5 crore as on 31 March 2026.

Amount Payable

For this category, the taxpayer does not pay 60% of the asset value.

Category 2 payment: A flat fee of ₹1 lakh, subject to the scheme conditions.

FAST-DS Category 1 vs Category 2

Particulars	Category 1	Category 2
Nature of default	Foreign income/asset not taxed and not disclosed	Asset acquired from taxed income or while non-resident but not reported
Maximum value	₹1 crore	₹5 crore
Amount payable	30% tax + 100% of tax as additional amount	₹1 lakh fee
Main benefit	Immunity from further covered tax, penalty and prosecution	Immunity for reporting lapse, subject to conditions
Typical case	Unreported foreign income / unexplained foreign asset	Schedule FA omission

RSUs and ESOPs Can Be Covered

FAST-DS is especially relevant for employees of multinational companies.

Suppose an Indian resident receives foreign-company RSUs or ESOPs.

Depending on the facts, the person may have been required to:

Report the foreign asset;
Disclose foreign income;
Report foreign custodial or brokerage accounts; and
Complete Schedule FA.

If these reporting obligations were missed in earlier returns, FAST-DS may provide an opportunity to regularise the position where the scheme conditions are satisfied.

The official Government FAQs specifically identify foreign employment benefits such as ESOPs and RSUs as common cases the scheme is intended to address.

Foreign Bank Accounts Can Also Be Relevant

The scheme is not limited to shares or ESOPs.

It can potentially cover eligible non-disclosures involving:

Foreign bank accounts;
Overseas shares;
Foreign brokerage accounts;
Insurance policies;
Immovable property;
Partnership interests;
Foreign securities; and
Other specified overseas assets.

The FAST-DS Rules also prescribe detailed valuation methods for different categories of foreign assets.

Important Valuation Date: 31 March 2026

For determining eligibility under the scheme, 31 March 2026 is a key valuation date.

The Rules contain valuation mechanisms for assets including:

Jewellery and bullion;
Shares and securities;
Immovable property;
Foreign bank accounts;
Partnership interests; and
Other foreign assets.

The correct valuation method should therefore be applied rather than simply using the original purchase cost or current market value without checking the Rules.

Four Forms Under FAST-DS 2026

The compliance process involves four forms.

Form	Filed/Issued By	Purpose
Form 1	Taxpayer	Declaration of foreign income/assets
Form 2	Tax authority	Order determining amount payable
Form 3	Taxpayer	Intimation and proof of payment
Form 4	Tax authority	Final certification of declaration/payment

Form 1

The taxpayer electronically files the initial declaration giving details of foreign income and assets.

Form 2

The prescribed income-tax authority determines the amount payable and communicates it through Form 2.

The order is generally required to be issued within one month from the end of the month in which the declaration is filed.

Form 3

After paying the determined amount, the taxpayer files Form 3 along with payment details.

The normal payment period is two months from the end of the month in which Form 2 is received.

A further period of up to two months is permitted with applicable simple interest.

Form 4

After verification, the Department issues Form 4 confirming the validity of the declaration and payment.

This becomes the final document evidencing completion of the FAST-DS process.

Form 1 Is Now Live on the Income Tax Portal

The Income Tax Department has now enabled FAST-DS filing on the e-Filing Portal.

The current navigation path is:

e-File → Income Tax Forms → File Income Tax Forms → Other Acts → Foreign Assets of Small Taxpayers Disclosure Scheme, 2026 → Form 1

Therefore, eligible taxpayers no longer need to wait for the electronic form to become available.

What Immunity Does the Scheme Provide?

Once a valid declaration is made and the required amount is paid, the declared income or asset is protected from further covered tax, penalty and prosecution under the scheme framework.

The Finance Act specifically provides that income or investment in the declared asset will not again be included in total income under the Income-tax Act or Black Money Act where the prescribed payment conditions are satisfied.

This makes the scheme particularly significant because Black Money Act consequences for foreign-asset non-disclosure can otherwise be severe.

FAST-DS Is Not Available for Every Foreign Asset Case

Taxpayers should not assume that every historical foreign non-disclosure can automatically be regularised.

Eligibility depends on factors including:

Residential status in the relevant year;
Nature of the foreign income or asset;
Source used to acquire the asset;
Value of the asset;
Whether tax had already been paid;
Whether prosecution or other excluded proceedings exist; and
Other statutory conditions.

Cases involving proceeds of crime and certain prosecution situations are outside the intended relief framework.

FAST-DS Deadline: 31 December 2026

The most important practical deadline is:

31 December 2026

Declarations cannot be treated as open-ended voluntary disclosures.

Taxpayers with historical foreign assets should therefore first conduct a year-wise review of:

Schedule FA;
Foreign Source Income;
Form 67 where relevant;
Overseas brokerage accounts;
RSUs and ESOPs;
Foreign bank accounts;
Foreign property; and
Prior ITRs.

This will help determine whether FAST-DS is actually required and which category applies.

Practical Checklist Before Filing FAST-DS

Before submitting Form 1:

Identify every foreign asset and foreign income item.
Determine the year in which each asset was acquired.
Check residential status for the relevant year.
Determine whether the source income had already been taxed.
Review old ITRs and Schedule FA disclosures.
Calculate the asset value under the FAST-DS valuation rules.
Confirm whether the ₹1 crore or ₹5 crore threshold applies.
Determine whether Category 1 or Category 2 is appropriate.
Prepare supporting evidence.
File Form 1 before 31 December 2026.

FAQs

What is FAST-DS 2026?

FAST-DS is the Foreign Assets of Small Taxpayers – Disclosure Scheme, 2026. It gives eligible taxpayers a one-time opportunity to disclose specified previously unreported foreign assets or foreign income.

When did FAST-DS become effective?

The scheme became effective from 16 August 2026.

What is the last date to file FAST-DS?

The deadline for making the declaration is 31 December 2026.

What is the limit for undisclosed foreign assets or income?

For Category 1 cases involving untaxed foreign income or assets, the aggregate limit is ₹1 crore as on 31 March 2026.

What is the tax payable under Category 1?

The taxpayer pays 30% tax plus an additional amount equal to 100% of that tax, resulting in an effective payment of 60%.

What if tax was already paid but Schedule FA was missed?

Eligible Category 2 cases involving foreign assets acquired from taxed income or while non-resident can fall within the scheme where the asset value does not exceed ₹5 crore. A ₹1 lakh fee applies subject to the conditions.

Can RSUs and ESOPs be disclosed under FAST-DS?

Potentially yes. The Government specifically identifies foreign ESOPs and RSUs among common situations the scheme is designed to address.

Is FAST-DS Form 1 available online?

Yes. The Income Tax Department has enabled FAST-DS Form 1 on the e-Filing Portal.

Related TaxClear Guides

For professional assistance with foreign-asset disclosure, Schedule FA or tax proceedings, explore TaxClear Legal Services.

Official References

Need help applying this to your situation?Practical guidance from the TaxClear CA Consultation Team.Try a free tax calculator →