Through Order F.No. 225/73/2025-ITA-II dated 8 July 2026, the Central Board of Direct Taxes (CBDT) has authorised the Director General of Income-tax (Systems) to upload foreign financial data received under the Automatic Exchange of Information (AEOI) framework directly into taxpayers' Annual Information Statement (AIS) – Form No. 168, within 90 days from the end of the month in which the data is received. Your foreign bank accounts, overseas investments, RSUs and foreign income will now be visible in your AIS — but you must still disclose them yourself in Schedule FA and Schedule FSI of your ITR. Non-disclosure can attract penalties of up to ₹10 lakh per year under the Black Money Act.
Indian cross-border tax compliance has fundamentally changed. In a landmark regulatory move, the Central Board of Direct Taxes (CBDT) has eliminated the information gap between international tax intelligence and taxpayer visibility. Through directive F.No. 225/73/2025-ITA-II, the CBDT has authorised the Director General of Income-tax (Systems) to auto-populate foreign assets, offshore bank accounts, and global source incomes directly into the taxpayer’s Annual Information Statement (AIS) via Form No. 168.
Historically, data obtained through global transparency frameworks like the Common Reporting Standard (CRS) and the Foreign Account Tax Compliance Act (FATCA) resided within the internal databases of the Income Tax Department, and was used mainly for retroactive scrutiny, re-assessments, and penalty notices. By moving this data into the taxpayer-facing AIS, the tax administration is shifting from an enforcement-first approach to a proactive self-compliance model. Taxpayers can now identify and reconcile global data mismatches before submitting their final Income Tax Returns (ITR).
What Does CBDT Order F.No. 225/73/2025-ITA-II Actually Say?
The statutory mechanics of this order create a structured, time-bound operation. Issued in exercise of powers conferred under Section 239 of the Income-tax Act, 2025, read with Rule 245(2) of the Income-tax Rules, 2026, the directive creates a binding operational obligation on the tax systems network.
Which Foreign Assets and Incomes Will Reflect in Your AIS?
Under the global AEOI standard, partner jurisdictions exchange comprehensive data on financial accounts held by Indian tax residents. If you hold overseas investments, employer equity benefits, or funds abroad, you should expect the following items to appear in your Form No. 168:
| Reportable Financial Asset | What Automatically Reflects in Form No. 168 |
|---|---|
| Foreign Bank Accounts | Account balances, account numbers, and the financial institutions holding accounts worldwide. |
| Overseas Investments | Mutual fund units, private equity stakes, and custodial holding values managed by overseas wealth managers. |
| Foreign Securities & Brokerage | Stock portfolios held in international brokerage accounts (e.g., US equity trading platforms). |
| RSUs & ESOPs | Vested Restricted Stock Units, Employee Stock Options, and share proceeds distributed by multinational employers. |
| Offshore Passive Income | Foreign dividend payouts, interest earned on foreign accounts, and capital gains from offshore disposals. |
Many taxpayers mistakenly believe that if an asset is auto-populated and visible to the government, their duty is fulfilled. This is a dangerous legal misconception. The visibility of a foreign asset in your AIS does not substitute for your legal obligation to declare it in your ITR. You must actively cross-verify, reconcile, and report these numbers in the specific schedules of your filing.
How Should You Reconcile Your ITR with the New AIS Data?
To ensure alignment between your auto-populated AIS and your tax return, your ITR filing must map items across multiple schedules accurately. Discrepancies between these elements can trigger automated system flags, resulting in processing holds or scrutiny notices.
1. Master Schedule FA (Foreign Assets) Compliance
Every asset appearing in your AIS under the AEOI banner must be listed in Schedule FA. This includes foreign depository accounts, custodial holdings, equity interests, or any financial asset where you hold beneficial ownership or signing authority.
Crucial Timing Note: Foreign institutions generally report asset balances on a Calendar Year basis (January to December), whereas Indian ITRs follow the Financial Year format (April to March). Your Schedule FA requires accurate conversion based on peak values and closing balances for the relevant accounting periods.
2. Aligning Schedule FSI (Foreign Source Income) and Schedule TR
If your AIS reflects foreign dividend income, interest, or international capital gains, this income must be reported in its primary schedule (e.g., Schedule OS for dividends) and also captured in Schedule FSI. To claim relief under Double Taxation Avoidance Agreements (DTAA), document the foreign tax withheld in Schedule TR and file Form 67 within the prescribed time limits.
What Are the Penalties for Non-Disclosure of Foreign Assets?
Failing to report global financial holdings carries severe statutory consequences in India. While under-reporting domestic income typically attracts interest and standard penalties, omitting foreign assets brings your case under the Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015.
If an offshore asset reflects in your AIS via AEOI data matching but is missing from your ITR’s Schedule FA, the consequences can include:
- Monetary Penalties: A penalty of up to ₹10 lakh per year can be levied for non-disclosure or inaccurate disclosure of foreign assets/accounts.
- Tax & Surcharges: Undisclosed foreign income is taxed at a flat rate of 30% with no deductions or set-offs, plus applicable penalty and interest.
- Prosecution: Wilful evasion or criminal non-disclosure can carry rigorous imprisonment ranging from 3 to 10 years.
How Can You Stay Compliant in the New Era of Cross-Border Transparency?
With the tax department automatically feeding international data streams into your permanent tax records, filing an accurate ITR requires specialised cross-border expertise. Guesswork, incorrect exchange-rate valuations, or simple omission can lead to serious regulatory disputes.
At efiletax, our tax professionals specialise in complex cross-border scenarios — from multi-jurisdictional employee RSUs and stock options to foreign bank reconciliations and DTAA tax credit claims. We audit your Annual Information Statement (Form No. 168), identify the underlying AEOI data, and cross-map every entry to ensure complete compliance with Schedule FA and Schedule FSI.
Frequently Asked Questions (FAQs)
It is an order dated 8 July 2026 issued under Section 239 of the Income-tax Act, 2025 read with Rule 245(2) of the Income-tax Rules, 2026, authorising the Director General of Income-tax (Systems), Delhi to upload foreign financial information received under the AEOI framework into the Annual Information Statement (Form No. 168) within 90 days from the end of the month in which the information is received.
Form No. 168 is the Annual Information Statement (AIS) under the Income-tax Act, 2025 regime. It consolidates financial transactions reported to the tax department — and will now also include foreign assets and income received under international exchange agreements like CRS and FATCA.
Foreign bank accounts, overseas investments, foreign dividend and interest income, foreign securities and brokerage holdings, vested RSUs and ESOPs, and other reportable financial assets shared under the AEOI framework.
Yes, absolutely. Auto-population in the AIS is only an information display — it does not replace your legal duty to disclose foreign assets in Schedule FA and foreign income in Schedule FSI of your ITR. Non-disclosure remains punishable even if the asset is visible in your AIS.
Under the Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015, non-disclosure can attract a penalty of up to ₹10 lakh per year, a flat 30% tax on undisclosed foreign income without deductions, and imprisonment of 3 to 10 years in cases of wilful evasion.
Foreign institutions report balances on a calendar-year basis (January–December), while Indian ITRs follow the financial year (April–March). You must map peak balances and closing values to the correct reporting period in Schedule FA, using broker or bank statements and the prescribed exchange rates for accurate conversion.
Have Foreign Assets or Overseas RSUs? Avoid Tax Notices
Don't let data mismatches between your AIS and ITR trigger penalties under the Black Money Act. Let the cross-border tax experts at efiletax report your global assets accurately.
Consult an Expert at efiletax.in