The income tax department has widened its scrutiny of Gujarat residents who bought homes and other assets abroad, by issuing summons to individuals whose overseas investments over the past seven to eight years were not disclosed in their income tax returns.
Alongside formal notices, some taxpayers have also received calls from officials seeking clarifications and supporting documents, indicating a stepped-up drive against undisclosed foreign assets. While some individuals were issued a notice for the second time, many got summons for the first time as the I-T department expanded its scrutiny.
Those contacted have been asked to provide detailed information on their income and funding trails, including details of family members, domestic and overseas bank accounts, and the source of funds used for foreign purchases. The notices seek particulars such as the date of acquisition, cost, mode of payment and details of other foreign investments and income generated from them.
A chartered accountant Lakhani said, “Earlier some assessees received summons but did not reply. They have again received summons on email and some are also getting calls from the department, seeking details about foreign investments and returns on these investments from 2018-19 to 2024-25.”
Chartered accountants said summons do not necessarily require physical appearance. Professionals advising taxpayers who have received notices said the immediate priority was to compile the requested information accurately within the prescribed timeline.
I-T officials are believed to be leveraging data received through global information-sharing arrangements. According to sources, the I-T department obtains financial account information of Indian residents from more than 100 countries through the Automatic Exchange of Information (AEOI) framework under the Common Reporting Standard (CRS), as well as the US Foreign Account Tax Compliance Act (FATCA).
Sources said even taxpayers who had disclosed foreign assets in their income tax returns received emails seeking additional details, suggesting that the exercise was not limited to suspected non-disclosures but also covers verification and reconciliation of reported information.
A CA tracking such cases said, “Even where a taxpayer has reported the foreign asset, the department appears to be validating the source of funds, remittance trail and consistency between annual information statement (AIS) data and the return disclosures, so responses need to be complete and well-documented.”
Source from: https://timesofindia.indiatimes.com/city/ahmedabad/under-scanner-taxpayers-get-i-t-notices-over-undisclosed-foreign-assets/articleshowprint/133163866.cms
