CBIC Right Behind Non-Responsive Foreign Income Earners! Here’s What We Know So Far
Notably, Switzerland has been providing annual data on Indian account holders since 2018
The Central Board of Direct Taxes (CBDT) has ramped up its crackdown on offshore tax evasion, sending a clear message to Indian taxpayers with foreign assets: disclose or face consequences. In a major follow-up drive based on data received from foreign jurisdictions, the CBDT has made significant progress in identifying and pursuing individuals who failed to report foreign income and assets in their tax filings.
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As part of global cooperation efforts to combat offshore tax evasion, India receives financial information from over 100 countries under various exchange of information frameworks. Notably, Switzerland has been providing annual data on Indian account holders since 2018 through the Automatic Exchange of Information (AEOI) mechanism, with the first data transmission to India taking place in September 2019.
Contrary to media reports suggesting a rise in deposits by Indian entities in Swiss banks, the government has clarified that the data reflects a wide range of funds, including those held by enterprises, banks, and individuals. More importantly, Indian tax authorities regularly scrutinize such data to identify potential tax evaders.
For Assessment Year (AY) 2024-25, the CBDT undertook a comprehensive review, comparing AEOI data with information disclosed by taxpayers in their Income Tax Returns (ITRs). Where discrepancies were found—especially cases where foreign assets and income were omitted from the relevant ITR schedules—SMS and email alerts were sent to nudge taxpayers to reassess and correct their filings.
This initiative has seen strong results. A total of 24,678 taxpayers revisited their returns, while 5,483 belated ITRs were filed, collectively reporting foreign assets worth ₹29,208 crore and foreign income totaling ₹1,089.88 crore. The number of taxpayers reporting foreign assets and income in AY 2024-25 surged to 2.31 lakh, marking a 45.17% increase over the previous year’s figure of 1.59 lakh.
The CBDT attributes this success to a system-driven and awareness-focused approach, which appears to have encouraged voluntary compliance. Taxpayers are not only disclosing their foreign holdings but are also proactively revising past returns to align with actual income.
However, the tax department has also warned of enforcement action against those who remain non-compliant. “Suitable action under extant provisions of law is under consideration for non-responsive taxpayers,” said the Ministry of Finance in a statement released on June 20. Where voluntary compliance fails, the department is resorting to legal options including searches, surveys, and open enquiries.
This robust follow-up reinforces India’s commitment to tackling offshore tax evasion and underscores the growing reach of international financial transparency. Taxpayers holding undisclosed assets abroad are being urged to come clean, as the government makes it increasingly difficult to hide wealth overseas.
As enforcement tightens, the message from the CBDT is unambiguous: cooperate and disclose, or be prepared for action under the law.
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