A forgotten foreign bank account can lead to a penalty of ₹10 lakh per year. If you have worked abroad and opened foreign bank account to receive your salary, it is essential to either close or disclose it upon returning to India. Even if the account is dormant, funded from tax-paid income, and has earned no income, failing to disclose it in Schedule FA can result in Rs.10 lakh penalty per year under section 43 of the Black Money Act.

It is important to understand that intent does not matter; the penalty is imposed for non-disclosure, not tax evasion.

The one-time disclosure opportunity announced in Budget 2026 allows residents to disclose forgotten foreign assets, avoid the ₹10 lakh penalty, and gain protection from prosecution.

If you have ever worked abroad or held foreign assets, it is advisable to review your Schedule FA now. An innocent mistake can become an expensive one if not corrected in time.