🧾 FATCA – Impact on Indian Taxpayers by Return Filings Via Flickr: If you’re an Indian taxpayer with any U.S. connection—citizenship, Green Card, or income—you need to understand how FATCA (Foreign Account Tax Compliance Act) applies to you.
🔍 What is FATCA? FATCA is a U.S. law that requires foreign financial institutions (like Indian banks and mutual funds) to report accounts held by U.S. taxpayers. India has signed an agreement with the U.S. to enforce FATCA compliance.
👥 Who Needs to Comply? Indian banks must collect FATCA declarations when opening accounts. Indian residents with U.S. ties must report global assets and income.
📋 How Does It Affect You? Non-compliance can result in blocked accounts or withheld transactions. Indian residents earning U.S. income must disclose it under Schedule FA in their ITR. Form 67 can be used to claim Foreign Tax Credit (FTC) and avoid double taxation under the India–U.S. DTAA.
⚠️ Penalties for Non-Disclosure: Up to ₹10 lakh per account under the Black Money Act. U.S. taxpayers risk IRS penalties for non-reporting.
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