NRI Foreign Asset Disclosure Scheme 2026 (FAST-DS) explained: RNOR eligibility test, Category A/B limits, FEMA risk, and country rules for US, UK, UAE.
If you are an NRI, RNOR, or a returning Indian with a foreign bank account, overseas shares, ESOPs, RSUs, pension investments or property, FAST-DS 2026 may give you a way to regularise an old foreign-asset or foreign-income disclosure problem. But your current NRI status alone does not decide eligibility. The key question is when the foreign income arose or when the foreign asset was acquired, and what your residential status was in that relevant year.
The Foreign Assets of Small Taxpayers Disclosure Scheme, 2026 (FAST-DS) is now operational. It came into force on 16 August 2026, and eligible taxpayers can submit declarations up to 31 December 2026. The scheme uses a valuation date of 31 March 2026 for the relevant foreign assets.
FAST-DS stands for the Foreign Assets of Small Taxpayers Disclosure Scheme, 2026. It is a one-time disclosure scheme introduced through Chapter IV of the Finance Act, 2026, covering Sections 130 to 144.
The scheme gives eligible taxpayers an opportunity to disclose specified foreign income and foreign assets that were not properly disclosed, subject to the prescribed conditions and payment of the applicable tax or fee. A valid declaration followed by the required payment can provide statutory immunity from further tax, penalty and prosecution under the Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015, subject to the conditions of the scheme.
For NRIs, the important point is that FAST-DS is not a scheme exclusively for people who are currently living outside India. The final rules use a broader eligibility test. A person who is currently non-resident or RNOR may still be eligible where the person was resident in India in the previous year to which the undisclosed foreign income relates or in the previous year in which the undisclosed foreign asset was acquired.
That makes the scheme particularly relevant to people who moved abroad, returned to India, changed from RNOR to resident status, or held overseas assets during different stages of their Indian tax residency.
The scheme became effective on 16 August 2026. The last date for filing a declaration is 31 December 2026, and the prescribed valuation date is 31 March 2026.
If you want the broader explanation of the scheme before focusing on your NRI situation, read Toolisky's complete FAST-DS 2026 explained guide.
This is the part that matters most for NRIs. Your passport, country of residence, OCI card or current NRI status does not by itself answer the FAST-DS question.
The final FAST-DS framework can cover a person who is:
Situation | FAST-DS position |
|---|---|
Resident in India in the relevant previous year | Can potentially make a declaration, subject to the category, value limits and other conditions. |
Currently non-resident but resident in India in the year to which the undisclosed foreign income relates | Can potentially make a declaration. |
Currently non-resident but resident in India in the year in which the undisclosed foreign asset was acquired | Can potentially make a declaration. |
Currently RNOR but was resident in India in the relevant year specified by the scheme | Can potentially make a declaration, subject to the statutory conditions. |
Foreign asset acquired entirely during a period when the taxpayer was non-resident | The asset may still fall under Category 2 if it was acquired from foreign income during the non-resident period and was not declared in the relevant Schedule after the taxpayer became resident. |
This is why saying “NRIs are not eligible” is too broad. The final rules specifically contemplate declarations by persons who are currently non-resident or RNOR but were resident in India in the relevant year.
For a detailed look at the ₹1 crore and ₹5 crore thresholds and how the two categories work, see the FAST-DS 2026 eligibility criteria and ₹1 crore/₹5 crore limits.
If you have lived outside India for several years, do not start with your current status. Start with a year-by-year timeline.
For every foreign asset or foreign income item, write down:
The year in which the income arose.
The year in which the foreign asset was acquired.
Your Indian residential status in that year.
Whether you were resident, RNOR or non-resident.
Whether the income was offered to tax in India.
Whether the asset was disclosed in the relevant Schedule of your Indian return.
The FAST-DS FAQs make the residency test particularly important for former residents. A person who is now non-resident or RNOR may make a declaration if that person was resident in India in the previous year to which the undisclosed foreign income relates or in the previous year in which the undisclosed foreign asset was acquired.
So a person who moved to the US, UK, UAE, Canada, Australia or another country years ago should not automatically conclude that FAST-DS is irrelevant. Equally, a current NRI should not assume that every foreign asset needs to be declared under FAST-DS. The relevant year and the source of the asset have to be established first.
For a wider explanation of Indian residential status and its effect on foreign-income taxation, it is useful to review your residential position separately before preparing a FAST-DS declaration.
The scheme has two main payment categories. They should not be mixed together because the eligibility conditions and payment mechanism are different.
Category | What it covers | Limit | Amount payable |
|---|---|---|---|
Category 1 | Undisclosed foreign asset and/or undisclosed foreign income covered by the scheme. | Aggregate value up to ₹1 crore | 30% tax plus an additional amount equal to 100% of the tax. |
Category 2 | Specified foreign assets acquired from foreign income during a non-resident period but not declared after becoming resident, or acquired from income already offered to tax in India but not declared in the relevant Schedule. | Asset value up to ₹5 crore | ₹1 lakh fee |
These figures are now part of the operational FAST-DS framework. The earlier draft description that the Category 2 amount was still awaiting notification is outdated. The notified scheme provides for a ₹1 lakh fee for the specified Category 2 cases.
Category 1 is the more expensive of the two routes because it deals with foreign income or assets that fall within the undisclosed category.
An undisclosed foreign asset can include an asset located outside India, including a financial interest in an entity, where the taxpayer holds or beneficially owns the asset and does not have a satisfactory explanation regarding the source of the investment.
Undisclosed foreign income refers to income from a source outside India that was chargeable to tax in India but was not offered to tax.
The aggregate value of the undisclosed foreign asset and undisclosed foreign income covered by Category 1 must not exceed ₹1 crore.
For an undisclosed foreign asset, the scheme applies the prescribed valuation rules using 31 March 2026 as the valuation date. For undisclosed foreign income, the relevant undisclosed income is considered for the tax calculation.
The payment works as follows:
30% tax on the applicable value of the undisclosed foreign asset; and/or
30% tax on the undisclosed foreign income; and
an additional amount equal to 100% of the tax calculated above.
In practical terms, where the entire relevant base is ₹40 lakh, the 30% tax is ₹12 lakh and the additional amount equal to the tax is another ₹12 lakh, resulting in ₹24 lakh payable under the scheme.
This category is particularly important for returning Indians.
Category 2 covers specified foreign assets where the source is not the problem, but the asset itself was not properly reported.
There are two important situations.
First: the foreign asset was acquired from income accruing or arising outside India during the period when the assessee was non-resident, but the asset was not declared in the relevant Schedule after the assessee became resident.
Second: the foreign asset was acquired from income that had already been offered to tax under the Income-tax Act, 1961, but the asset itself was not declared in the relevant Schedule of the return.
If the asset satisfies the Category 2 conditions and its value does not exceed ₹5 crore, the prescribed payment is a ₹1 lakh fee.
This is important for NRIs because an asset can have been legitimately acquired while the person was living abroad. The question is not simply whether the asset existed during an NRI year. You need to check the statutory Category 2 conditions and what happened after the person became resident.
For example, a foreign investment acquired from foreign earnings during a genuine non-resident period can potentially fall within this category where the asset was not disclosed in the relevant Schedule after the taxpayer became resident.
FAST-DS deals with income-tax and Black Money Act consequences. It is not a general amnesty for every legal issue connected with a foreign asset.
This distinction matters for NRIs because foreign assets can have a separate FEMA history.
For example, an Indian resident who funded an overseas investment through a route that did not comply with the applicable FEMA rules should not assume that a FAST-DS declaration automatically regularises that FEMA issue.
The tax disclosure and the foreign-exchange compliance questions should therefore be examined separately.
This is particularly important where the asset was funded through:
large overseas remittances made while resident in India;
transactions involving the Liberalised Remittance Scheme;
gifts or transfers between resident and non-resident family members;
foreign property purchases funded from India;
old overseas accounts that changed status after the taxpayer returned to India.
A valid FAST-DS declaration does not turn a separate FEMA question into an income-tax question. If the source or remittance history is complicated, have the FEMA position checked separately before filing.
United States — 401(k), IRA, brokerage accounts, ESOPs and RSUs. Many returning Indians have accumulated retirement accounts, employer stock or brokerage investments while working in the US. The FAST-DS analysis depends on when the asset was acquired, the taxpayer's Indian residential status in the relevant year, whether the underlying income was taxable in India and whether the asset was disclosed after the taxpayer became resident.
Do not assume that every US retirement account automatically belongs in Category 2. The source of the investment and the precise statutory conditions have to be established.
United Kingdom — pensions, investment accounts and shares. A former UK resident returning to India may have pension or investment assets that continue to exist after the person becomes Indian resident. The year of acquisition, the source of funds and the disclosure history should be checked before deciding whether FAST-DS applies.
UAE — bank accounts, investments and property. Many Indian professionals who worked in the UAE retain bank balances, investments or property after returning to India. The absence of UAE personal income tax does not by itself determine the Indian FAST-DS category. The relevant question is how the asset was acquired, whether the underlying income was taxable in India, and what was disclosed in the Indian return after the person became resident.
The same approach applies to assets in Singapore, Canada, Australia, Germany, Saudi Arabia or any other jurisdiction. FAST-DS eligibility is determined under Indian law; it is not based on the country where the asset happens to be located.
Example 1 — Returning from the UAE. Ramesh worked in Dubai and later returned to India. After becoming resident, he continued to hold a UAE bank account containing ₹35 lakh. If the account or the relevant income falls within the Category 1 conditions and the aggregate value remains within ₹1 crore, the Category 1 calculation would be 30% tax plus an additional amount equal to that tax. On a ₹35 lakh base, that is ₹10.5 lakh tax plus ₹10.5 lakh additional amount, or ₹21 lakh.
Example 2 — Asset acquired while non-resident. Farida worked in the US while she was non-resident in India and accumulated a foreign investment from income earned during that period. She later became resident in India but failed to disclose the foreign asset in the relevant Schedule. If the asset satisfies the statutory Category 2 conditions and its value is within ₹5 crore, the applicable payment is the ₹1 lakh fee.
Example 3 — Income already taxed in India. Priya received taxable compensation in India and used part of that already-taxed income to acquire foreign securities. The securities were not reported in the relevant Schedule. If the statutory Category 2 conditions are satisfied and the asset value is within ₹5 crore, the Category 2 fee can apply.
Example 4 — Current NRI with an old Indian-resident year. Arjun now lives permanently outside India. However, the foreign income he wants to disclose relates to a year in which he was resident in India. His current NRI status does not automatically prevent him from making a FAST-DS declaration. The relevant residency condition is tied to the year to which the undisclosed income relates.
The calculation depends on the category.
Category 1: The tax is calculated at 30% on the relevant fair market value of the undisclosed foreign asset and/or 30% on the undisclosed foreign income, as applicable. An additional amount equal to 100% of the tax calculated is also payable.
For a ₹60 lakh undisclosed foreign asset with no other relevant amount, the basic calculation is:
30% of ₹60 lakh = ₹18 lakh tax.
Additional amount equal to tax = ₹18 lakh.
Total = ₹36 lakh.
Category 2: Where the statutory conditions are satisfied and the foreign asset does not exceed ₹5 crore, the prescribed fee is ₹1 lakh.
The valuation should not be guessed. The FAST-DS Rules prescribe valuation methods for different types of foreign assets, and the valuation date is 31 March 2026.
The FAST-DS process is now live and is completed electronically.
Build your year-by-year foreign-asset history. Identify when each account, investment, property or other foreign asset was acquired.
Determine your Indian residential status. Record whether you were resident, non-resident or RNOR in the relevant year.
Identify the source of the asset. Establish whether it came from foreign income during a non-resident period, income already offered to tax in India, or income that was never offered to tax.
Review previous Indian returns. Check whether the asset or income was actually reported and whether the relevant Schedule was completed.
Determine the FAST-DS category. Check the ₹1 crore Category 1 limit or the ₹5 crore Category 2 limit, as applicable.
Calculate the prescribed value. Use the notified valuation rules and the 31 March 2026 valuation date.
File Form 1 electronically. The declaration is submitted through the Income Tax e-Filing system.
Review Form 2. The prescribed authority determines the amount payable and communicates the order electronically.
Pay the amount within the prescribed period. The payment process is governed by the FAST-DS provisions and rules.
Submit payment details through Form 3.
Obtain Form 4. The final certification confirms the validity of the declaration and payment where the statutory requirements have been met.
Form 1 is now available on the e-Filing portal. Therefore, the earlier advice to “wait for the form to be notified” should no longer be followed.
NRIs and returning Indians should collect the documents before starting the declaration rather than trying to reconstruct the history while filling the form.
PAN and passport details.
Travel history and documents supporting Indian residential status for the relevant years.
Previous Indian income-tax returns.
Previous Schedule FA disclosures, where filed.
Foreign bank statements and account-opening records.
Foreign brokerage statements.
ESOP and RSU grant and vesting statements.
Foreign pension or retirement-account statements, where relevant.
Foreign property purchase documents and valuation records.
Documents showing the source of funds used to acquire the foreign asset.
Evidence of Indian tax already paid on the underlying income, where Category 2 is being considered on that basis.
Documents showing that the asset was acquired while the taxpayer was non-resident, where the Category 2 returning-resident provision is relevant.
Fair market value information required under the FAST-DS Rules as on 31 March 2026.
The notified Form 1 itself asks for details including the declarant's PAN, passport information, the type of asset or income, the relevant previous year, residential status during the relevant year and supporting documents.
You changed from NRI to RNOR and then to resident. Do not treat the entire period as one block. Separate each previous year and establish your status year by year.
You held the same foreign account before and after returning to India. The account's existence alone does not tell you whether FAST-DS applies. Trace the source of the balance and the years in which the relevant income or asset should have been disclosed.
You paid Indian tax but forgot the foreign asset disclosure. Check Category 2 carefully. The final law specifically covers certain assets acquired from income already offered to tax in India but not declared in the relevant Schedule.
You acquired the asset while non-resident and forgot to disclose it after becoming resident. This is one of the situations expressly addressed by Category 2, provided all other conditions and the ₹5 crore limit are satisfied.
You received an income-tax notice. Do not automatically assume that a notice makes FAST-DS unavailable. Pending assessment proceedings are not the same thing as a completed Black Money Act assessment. The scheme contains specific provisions dealing with pending proceedings.
Your asset has a complicated FEMA history. Keep the FEMA analysis separate. FAST-DS should not be treated as a substitute for FEMA compliance or compounding.
If an eligible taxpayer does not use FAST-DS, the ordinary Black Money Act consequences can remain relevant where the statutory conditions for that Act are satisfied.
The Black Money Act can impose 30% tax on undisclosed foreign income or assets and a penalty equal to three times the amount of tax in specified cases. This can produce an effective 120% tax-and-penalty exposure before considering other consequences.
The Act also contains separate penalties for failure to furnish information or report foreign assets, subject to the statutory exceptions and thresholds. Criminal prosecution provisions can also apply in appropriate cases.
FAST-DS is therefore materially different from simply correcting a Schedule FA omission. A valid declaration and payment can provide the statutory immunity available under the scheme for the declared matter, subject to the conditions in the Finance Act, 2026.
Yes, potentially. A current NRI can make a declaration where the statutory residency condition is satisfied. In particular, the scheme covers a person who is currently non-resident but was resident in India in the previous year to which the undisclosed foreign income relates or in the previous year in which the undisclosed foreign asset was acquired.
Yes, potentially. The final FAST-DS eligibility definition expressly covers a person who is non-resident or RNOR in the relevant previous year if the person was resident in India in the previous year to which the undisclosed foreign income relates or in the previous year in which the undisclosed foreign asset was acquired.
No. FAST-DS looks at the relevant year and the statutory residency conditions. Your current NRI status by itself does not decide whether you can make a declaration.
Potentially. Category 2 specifically covers an asset located outside India acquired from income accruing or arising outside India during a period when the assessee was non-resident, where the asset was not declared in the relevant Schedule after the assessee became resident. The ₹5 crore limit and other conditions also apply.
This can fall under Category 2 if the asset was acquired from income that was offered to tax under the Income-tax Act, 1961 but the asset was not declared in the relevant Schedule. The asset value must not exceed ₹5 crore and the other statutory conditions must be satisfied.
The prescribed fee for the relevant Category 2 declaration is ₹1 lakh, provided the foreign asset and the taxpayer satisfy the statutory conditions and the asset value does not exceed ₹5 crore.
The aggregate value of the undisclosed foreign asset and undisclosed foreign income covered under Category 1 must not exceed ₹1 crore.
The value of the relevant foreign asset under Category 2 must not exceed ₹5 crore.
The FAST-DS Rules, 2026 came into force on 16 August 2026.
The last date for filing a declaration is 31 December 2026. The scheme is time-bound, so taxpayers should not wait until the final days to establish eligibility and collect supporting records.
The prescribed valuation date is 31 March 2026. The applicable valuation method depends on the type of foreign asset.
Foreign securities and financial interests can fall within the foreign-asset framework. Whether a particular ESOP or RSU should be disclosed under FAST-DS depends on the acquisition, vesting, source of funds, taxation and prior disclosure history. Do not classify every ESOP or RSU automatically as Category 2.
A US retirement account can raise foreign-asset and disclosure questions for an Indian tax resident. The FAST-DS treatment depends on the relevant years, residential status, source of the investment and the disclosure history. A 401(k) or IRA should therefore be reviewed on its own facts rather than automatically treated as either Category 1 or Category 2.
No. FAST-DS is a tax and Black Money Act disclosure mechanism. A separate FEMA issue, such as a problem concerning the funding or acquisition of an overseas asset, should be examined under the applicable FEMA framework.
A pending assessment does not automatically mean that FAST-DS is unavailable. The Finance Act contains specific provisions dealing with pending assessment proceedings. However, the exact status of the proceedings and the nature of the asset or income should be checked before filing.
The scheme contains exclusions for income or assets relating to an assessment year where assessment proceedings under the Black Money Act, 2015 have already been completed. This is different from merely having a pending proceeding.
No. OCI status itself is not the eligibility test. FAST-DS uses the statutory Indian residential-status and asset/income conditions. An OCI holder should therefore examine the relevant previous year and tax-residency position rather than relying on OCI status alone.
Do not automatically assume that every missed year can be grouped together. Review the relevant years, residential status, source of each asset and the applicable FAST-DS category. Category 2 is specifically designed for certain assets whose source is explained or whose acquisition occurred during a non-resident period but which were not subsequently disclosed in the relevant Schedule.
Potentially, yes. Category 2 specifically addresses certain foreign assets acquired from income accruing or arising outside India during a period when the taxpayer was non-resident, where the asset was not declared after the taxpayer became resident.
If you are an NRI, RNOR or returning Indian, do not begin by calculating the 60% amount. Begin by making a simple year-by-year foreign-asset timeline.
List every foreign bank account, investment, pension account, ESOP, RSU, insurance policy and property.
Write down the acquisition date and source of funds for each asset.
Mark whether you were resident, RNOR or non-resident in each relevant year.
Check every Indian ITR and the relevant Schedule FA.
Identify whether the underlying income was already offered to tax in India.
Check whether the facts fit Category 1 or Category 2.
Apply the ₹1 crore or ₹5 crore limit as applicable.
Determine the value using the FAST-DS valuation rules as on 31 March 2026.
Separately check whether any FEMA issue exists.
Prepare the supporting documents before filing Form 1.
For the exact threshold and category test, use Toolisky's FAST-DS 2026 eligibility criteria and ₹1 crore/₹5 crore limits. For the broader scheme, payment, immunity and filing framework, read the complete FAST-DS 2026 explained guide.
The important date is now fixed: 31 December 2026. The scheme is already operational, so there is no reason to wait for the commencement notification that earlier versions of this article referred to. If you believe you have a historical foreign-asset disclosure issue, establish the facts and category first, then decide whether a FAST-DS declaration is appropriate.
For educational purposes only. FAST-DS 2026 eligibility and payment requirements depend on the Finance Act, 2026, the Foreign Assets of Small Taxpayers–Disclosure Scheme Rules, 2026 and applicable official guidance. Verify the latest requirements on the Income Tax Department e-Filing portal before filing. Toolisky is not affiliated with any government body. Consult a qualified CA, tax adviser or FEMA professional where your facts involve foreign assets, residency changes, pending proceedings or cross-border funding. See Toolisky's accuracy and limitations.
FAST-DS 2026 eligibility explained: Category A/B limits, the ₹1 crore and ₹5 crore thresholds, NRI, HUF, and company rules, with two worked ₹ examples.
Jul 18, 2026
FAST-DS 2026 explained in simple words: who qualifies, the ₹1 lakh flat fee vs 60% tax option, real status update, and penalties.
Jul 17, 2026
No TAN for NRI property purchase applies only from 1 October 2026, and only to resident individual and HUF buyers. Get the rates, forms, and dates you need.
Jul 25, 2026
