'From crypto to unlisted shares': 8 ITR disclosures that could cost taxpayers ₹10 lakh, warns tax expert

Filing an Income Tax Return (ITR) without complete disclosures can prove costly, cautions Sujit Bangar, Founder of TaxBuddy. He warned that non-disclosure of certain financial details — especially foreign assets — may render returns defective and attract penalties of up to ₹10 lakh along with imprisonment. 

In a post on X (formerly Twitter), Bangar said, “Miss one disclosure in your ITR, your return might get defective. For non-disclosure of foreign assets, ₹10 lakh penalty may be applicable.” 

He flagged eight critical areas of disclosure that taxpayers must not overlook while filing returns: 

• Foreign Assets (Schedule FA): Mandatory for residents holding overseas bank accounts, securities, insurance, ESOPs, immovable property, or signatory rights. Non-disclosure may result in a ₹10 lakh penalty and imprisonment of six months to seven years. Relief is available if the value of assets (other than immovable property) is below ₹20 lakh. 
• Foreign Income (Schedule FSI): Country-wise reporting of foreign income, its nature, tax paid, and amount. Same penalty provisions as above apply. 
• Crypto/NFTs (Schedule VDA): Each transaction must be disclosed with acquisition, sale, cost, and value details. Losses cannot be set off under Section 115BBH. 
• Unlisted Equity Shares: Shareholding details, including purchase/sale dates, company name, face value, and quantity, are mandatory. 
• Directorships: Directors must disclose their DIN, company PAN, and whether the company is listed or unlisted. 
• Assets & Liabilities (Schedule AL): Compulsory for taxpayers with income above ₹1 crore. Includes disclosures on immovable property, jewellery, vehicles, shares, cash, loans, advances, and liabilities. 
• Partnership in Firm (Schedule IF): Partners filing ITR-3 must report firm details, percentage shareholding, and remuneration, which should tally with the firm’s ITR-5. 
• Bank Accounts & Verification: Refund accounts must be pre-validated with correct IFSC codes, and e-verification must be completed within 30 days. Otherwise, the return is not treated as filed. 

Bangar stressed that missing or incorrect disclosures can make a return defective under Section 139(9). He particularly warned that overlooking foreign assets could lead to severe financial and legal consequences.