Do NRIs Have to Reveal Foreign Assets and Bank Accounts?

Do NRIs Have to Reveal Foreign Assets and Bank Accounts?

Many NRIs like you might not be sure whether they have to disclose their foreign bank account details, or the assets that they own abroad when filing their tax returns in India. This has created some confusion. This article will clear the air.

Cause for Comfort

The Income Tax Appellate Tribunal (ITAT) in India has categorically stated that NRIs don’t have to disclose the details of the bank accounts or assets that they hold abroad. It is the responsibility of the Income Tax authorities to prove if an NRI has stashed undeclared income from India in bank accounts abroad.

The government of India has acknowledged the fact that by simply having a foreign bank account, an NRI is not doing anything illegal. Only residents come under the ambit of the Black Money (undisclosed foreign income and assets) and Imposition of Tax Act, 2015.

The Mumbai bench of the ITAT, while passing its verdict in the case of the NRI Hemant Mansukhlal Pandya, mentioned a statement made by India’s Minister of State for Finance in 2011. He said that simply having an account abroad doesn’t imply by default that the amount parked there is tax-evaded. Not all NRIs are guilty of this crime.

The onus doesn’t lie on you to prove whether the income has been earned abroad. Since your NRI status is proven without dispute, the Income Tax department needs to prove the fact if it suspects that the money has been earned in India.

When do you Need to Furnish the Details?

If you do not have a bank account in India, then you would need to provide the details of your foreign bank account in order to claim the refunds that get credited to your bank account. This facility was not available earlier and that had been causing problems to many NRIs. Now they can breathe easy.

If you have an Indian bank account, then the refund would get credited there. You don’t need to provide the details of your foreign bank account.

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