TaxTMI 
TaxTMI 
Foreign Assets of Small Taxpayers- Disclosure Scheme Rules, 2026.
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....date" means the 31st day of March, 2026. (2) Words and expressions used in these rules and not defined but defined in the Act or the Income-tax Act, 1961 (43 of 1961) or the Income-tax Act, 2025 (30 of 2025) or the Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015 (22 of 2015) shall have the meanings respectively assigned to them in those Acts. (3) For the purposes of the Act and these rules, "income-tax authority" shall mean the Principal Director General of Income-tax (Systems) or the Director General of Income-tax (Systems), as the case may be. (4) For the purposes of the Act and these rules, "last date" shall mean the 31st day of December, 2026. 3. Fair market value .- (1) For the purposes of clause (I) of sub-section (1) of section 131 of the Act, the fair market value of the assets shall be determined in the following manner, namely :- (a) value of bullion, jewellery or precious stone shall be the higher of,- (i) its cost of acquisition; and (ii) the price that the bullion, jewellery or precious stone shall ordinarily fetch if sold in the open market on the valuation date for which the assessee may obtai....
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....- (i) any amount of income-tax paid, if any, less the amount of income-tax refund claimed, if any, and (ii) any amount shown as asset including the unamortised amount of deferred expenditure which does not represent the value of any asset; B = fair market value of bullion, jewellery, precious stone, artistic work, shares, securities and immovable property as determined in the manner provided in this rule; L = book value of liabilities, but not including the following amounts, namely :- (i) the paid-up capital in respect of equity shares; (ii) the amount set apart for payment of dividends on preference shares and equity shares; (iii) reserves and surplus, by whatever name called, even if the resulting figure is negative, other than those set apart towards depreciation; (iv) any amount representing provision for taxation, other than amount of income-tax paid, if any, less the amount of income-tax claimed as refund, if any, to the extent of the excess over the tax payable with reference to the book profits in accordance with the law applicable thereto; (v) any amount representing provisions made for meeti....
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....posits made in the account with the bank since the date of such declaration: Provided that where any deposit is made from the proceeds of any withdrawal from the account, such deposit shall not be taken into consideration while computing the value of the account. Illustration 1: An assessee had opened a foreign bank account (BA) in 2010. The following deposits and withdrawals were made in BA since then. Assuming that the withdrawals made were later re-deposited into the BA, the value of the asset shall be calculated as follows. Date Deposits Withdrawals Calculation of value of asset 01.04.2010 $ 1,000 - $ 1,000 01.06.2011 $ 500 - $ 500 01.08.2011 - $ 700 - 01.04.2012 $ 500 - - 01.08.2013 $ 500 - $ 300 01.04.2019 $2,500 - $ 2,500 01.06.2020 - $ 400 - 01.09.2021 $ 1,000 - $ 600 01.05.2024 - $ 500 - TOTAL $ 4,900 The value of this asset, that is, $ 4,900 will be converted into Rupees as on 31st March, 2026 for the purpose of valuation under these rules. Illustration 2: If the above assess....
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....ndexed cost of acquisition shall be deemed to be the fair market value where the valuation as per sub-clause (ii) is not carried out. (2) Notwithstanding anything contained in sub-rule (1), where an asset (other than a bank account) was transferred before the valuation date, the fair market value of such asset shall be higher of its cost of acquisition and the sale price: Provided that where such asset was transferred without consideration or inadequate consideration before the valuation date, the fair market value of the asset shall be higher of its cost of acquisition and the fair market value on the date of transfer. (3) Where a new asset has been acquired or made out of consideration received on account of transfer of an old asset or withdrawal from a bank account, then the fair market value of the old asset or the bank account, as the case may be, determined in accordance with sub-rule (1) or sub-rule (2) shall be reduced by the amount of the consideration invested in the new asset. Illustration 1: A house property (H1) located outside India was bought in 2014 for twenty lakh rupees. It was sold in 2017 for twenty- five lakh rupees which were deposited in a foreign....
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.... bank regulated under the laws of that country or jurisdiction. Explanation 1 .- For the purposes of this rule,- (a) "established securities market" means an exchange that is officially recognised and supervised by a Governmental entity in which the market is located and that has a meaningful annual value of shares traded on the exchange; (b) "meaningful annual value of shares traded on the exchange" with respect to an exchange means it has an annual value of shares traded on the exchange (or a predecessor exchange) exceeding one billion United States Dollar during each of the three calendar years immediately preceding the valuation date; (c) "meaningful volume of trading on an on-going basis" with respect to each class of shares means,- (i) trades in each such class are effected, other than in de minimis quantities, on one or more established securities markets on at least sixty business days during the prior calendar year; and (ii) the aggregate number of shares in each such class that are traded on such market or markets during the prior year are at least ten per cent. of the average number of shares outstanding in that class durin....
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....lustration 3: * Certain units of Mutual Fund (MF) abroad were purchased in 2020 from income offered to tax in India when the assessee was a resident. Subsequently, the assessee failed to disclose MF in the relevant Schedule of the return of income. The value of MF on the valuation date is Rs.2.5 crore. * The assessee also acquired certain quoted shares and securities (QS) on the New York stock exchange in 2022. The value of QS on the valuation date is Rs.4 crore. * The total value of both these assets acquired in year 2020 and 2022, that is, MF + QS is Rs. 6.5 crore which exceeds Rs.5 crore. Hence, the case is not covered under the Table in section 133 of the Act and the assessee is not eligible to declare under this scheme. 5. Declaration of asset or income located outside India .- (1) A declaration in respect of any asset or income referred to in section 133 of the Act shall be made electronically in Form 1 to the income-tax authority such that the aggregate value of undisclosed income and undisclosed assets declared under section 133 (Table: Sl. No 1) shall not exceed Rs. 1 crore and the aggregate value of undisclosed assets declared under section 1....
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....ion 135 electronically in Form 2, in respect of payment of amount payable by the declarant, along with penalty or fee. 7. Intimation of payment .- The declarant shall make the payment of the amount determined in the order passed by the income-tax authority under sub-section (1) of section 135 electronically, and the intimation of such payment made, including interest, if any, shall be furnished along with proof of payment to the income-tax authority electronically in Form 3. Illustration: An undisclosed foreign bank account (FA) exists as on 31st March, 2026. The value of FA on that date is Rs.80 lakh. Therefore, the total amount payable under section 133 (Table: Sl. No 1) of the Act is Rs.48 lakh. Assume the order of the income-tax authority under sub-section (1) of section 135 is passed on 22nd September, 2026. End of the month of order = 30th September, 2026. (i) Payment within two months: Last date without interest = 30th November, 2026. Therefore, if the assessee pays on 25th November, 2026 the amount payable is Rs.48 lakh. (ii) Payment after two months but within additional period: (A) Payment on 17th December, 2026-....
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....Passport Number (refer Note 3) (v) Passport Details (refer Note 3) UPLOAD Part- B (Details of asset or income) 2. A. (i) Type of asset or income as per column (2) of Table in section 133 (Select one) 1. undisclosed asset located outside India 2. undisclosed foreign income 3. asset located outside India acquired from income accruing or arising outside India, by an assessee, during the period in which such assessee was a non- resident, but such assets were not declared by him in the relevant schedule in the return of income on becoming a resident 4. asset located outside India acquired from income which has been offered to tax under the Income-tax Act, 1961 by the assessee, but such assets were not declared by him in the relevant schedule in the return of income (ii) Relevant previous year of acquisition of asset or earning of income yyyy-yy (iii) Residential status during year of acquisition of asset or earning of income (Select one) 1. Resident 2. Non-resident 3. Resident but Not Ordinarily Resident (RNOR) (iv) Any relevant documents showing proof of acquisition of asset or earning of income, as applicable. ....
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.... vi. Area/locality, vii. District, viii. State 3. The details of passport shall be filled if the declarant claims to be a non-resident in any of the years for which declaration is made. 4. Amounts to be filled in Rs. unless otherwise provided. 5. Where valuation is not carried out, the indexed cost of acquisition will be deemed to be the fair market value. Annexure to Form 1 Statement of assets or income located outside India A1. Bank account (a) Name of Bank (b) Address of Bank (c) Country of location (d) Account holder name(s) (e) Account Number (f) Account opening date (g) Sum of all credits in the account (h) Fair market Value as per Rule 3 [Provide separate computation if different from (g)] A2. Immovable property (attach valuation report, if applicable) (a) Nature of property (land/building/flat etc.) (b) Address of the property (c) Country of location (d) Name(s) under which held (e) Date of acquisition &....
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....ation (ix) Fair Market value as per Rule 3 (b) Unquoted equity share [Rule 3(1)(c)(ii)] (attach valuation report, if applicable) (i) Description of share (A) Name of issuer (B) Number of shares (C) Type of share (ii) Country of location (iii) Name(s) under which held (iv) Date(s) of acquisition (v) Cost of acquisition (vi) Indexed cost of acquisition (vii) Value as determined under Rule 3(1)(c)(II), if applicable (viii) Date of valuation (ix) Fair market value as per Rule 3 (c) Unquoted shares and securities other than equity shares in a company [Rule 3(1)(c)(iii)] (attach valuation report, if applicable) (i) Description of security/share (A) Name of issuer (B) Number of securities/shares (C) Type of security/share (ii) Country of location (iii) Name(s) under which held (iv) Date(s) of acquisition (v) Cost(s) of acquisition (vi....
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.....2 Unquoted equity share A5.3. Unquoted shares and securities other than equity shares in a company A6. Any other asset (ii) (Repeat as required) (iii) Aggregate fair market value (refer Note 3) 5. Total fee payable (refer Note 3) 6. Aggregate amount payable [3 + 5] (refer Note 3) Part- C [Order under section 135(1)] In exercise of the powers conferred by section 135(1) of the Finance Act, 2026 and based on the information submitted by the declarant in Form 1, the declarant is hereby directed to make the payment of sum payable, if any, as mentioned in row 6 within two months from the end of the month of receipt of this certificate In case of payment made after the period mentioned in (a) above, the amount shall be paid along with interest at the rate of 1% per month (or part thereof) within a further period not exceeding two months from the end of the period mentioned in (a) above. In case of non-payment of amount payable within the time mentioned in (b) above, the declaration under Form-1 shall be treated as void....
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....on 135(4) of the Finance Act, 2026, and in pursuance of the order received from designated authority in Form-2 vide Order No._____ dated _____ in respect of _____________ (Name of the declarant), having PAN _____________, this intimation is hereby made. I solemnly declare that to the best of my knowledge and belief, the information given in this declaration is correct and complete. Date: Place: Signature: Name: Note :- 1. In case of individual, the first, middle and last name shall be provided in full without any abbreviations. In any other case also, the name shall be provided in full. 2. The address shall contain i. Country/Region, ii. Flat/Door/Building, iii. Road/Street/ Block/Sector, iv. PIN/ZIP Code, v. Post Office, vi. Area/locality, vii. District, viii. State 3. Amounts to be filled in Rs. unless otherwise provided. 4. Additional interest at the rate of one per cent for every month or part thereof shall be payable for the period exceeding the initial two months, subject to a maximum of two additional months, in accordance with section 135 (3) o....