Why MNC staff are getting tax notices for foreign assets

Income Tax Department has started sending alerts to employees of multinational companies (MNCs), reminding them to report any foreign income or assets by December 31, 2025. This action is part of the NUDGE 2.0 initiative, which uses global data-sharing frameworks like the Automatic Exchange of Information (AEOI) to detect unreported overseas assets.

The Central Board of Direct Taxes (CBDT) is also engaging directly with employers, asking them to encourage staff to check and revise their income tax returns (ITR) before the deadline. This date marks the final chance to file a revised or belated ITR for FY 2024-25 (AY 2025-26).

Indian residents must declare all foreign bank accounts, shares, ESOPs, properties, or other assets in Schedule FA, even if they don’t earn income from them. Overseas income such as salary, capital gains, or dividends must also be reported even if tax was already paid abroad.

Those who missed earlier disclosures can regularise them by filing a revised or updated return (ITR-U) within 48 months. Non-disclosure may lead to 30% tax, a penalty of three times that tax, and fines up to ₹10 lakh. The government’s message is simple voluntary compliance is safer than facing penalties later.