Who is Required to Report Foreign Assets in ITR?

Foreign assets can be reported by the beneficial owners, beneficiaries of the foreign assets, residential individuals, and Hindu undivided families (HUF). It is very important to file the ITR. Here are some of the points that will help you to know more about it:

• Foreign Tax reports in the ITR are important because they help the Income Tax Department to get all the information about the foreign assets owned by individuals, HUFs, and residents, such as foreign income sources, bank accounts, real estate, interests, dividends, or capital gains they get from foreign sources. According to the Black Money Act, 2015, it is important for individuals to report their foreign assets and income in the foreign country. 
• Reporting of the foreign assets helps the individual taxpayer to get claims on the tax paid in a foreign country, and allows the benefits of the Double Taxation Avoidance Agreement (DTAA). 
• It is important to disclose your foreign assets in the ITR filing. If you failed to do so, you can get a penalty of 10 lakh INR from the Income Tax Department. 
• Providing the foreign assets reports in the ITR helps the Income Tax Department to track taxpayers' global foreign holdings and ensure that they are meeting all the tax liabilities. 

Here is the penalty for not reporting your foreign assets in the ITR. 

1. If you don't report your foreign assets, then you can get a penalty of 10 lakhs INR. 
2. For not reporting the foreign assets in your ITR, you could be jailed for 7 years, considering willful evasion of tax. 
3. You cannot get the double taxation avoidance agreement if you don't report your foreign assets, which results in the revocation of the right to claim tax benefits under DTAA.