The Indian star hit the headlines earlier this week (begs24Jan11) after representatives for the country's tax authorities confirmed officials had raided the offices and homes of Kaif and her peer Priyanka Chopra, in addition to a number of other top Bollywood names.
Tax department director-general D.P. Gaur confirmed on Monday (24Jan11) that properties belonging to the actresses were "being searched and whatever materials are procured will be recorded for further action", but refused to go into further detail.
However, a "disturbed" Kaif has hit out at the claims and she is adamant all her tax payments are up-to-date.
A statement issued by her accountants adds: "Katrina is fully co-operating with the (tax) department, whom she holds in high regard."
Kaif is said to earn $670,000 (£446,670) per film.