New Delhi, July 16 -- For years, the Income Tax Department may have known more about more about your foreign financial footprint than you realized. That information gap is now beginning to close.

In a step towards greater tax transparency, the Central Board of Direct Taxes (CBDT) has directed that information received from foreign tax authorities under the Automatic Exchange of Information framework should appear in taxpayers' Annual Information Statement (AIS). Information is already enabled in AIS for calendar years 2022, 2023 and 2024, which all taxpayers should check and reconcile while filing their ITR for the current year.

On the surface, this may look like another technology upgrade. In practice, it could change how taxpayers app...