Got RSUs from your US employer? Bought a few shares of Apple or Tesla through an app like Vested or IND money? If yes, there's one part of your tax return you cannot afford to skip — Schedule FA.

What is Schedule FA?

Schedule FA (Foreign Assets) is a section in your Income Tax Return where you declare any foreign assets you held during the year — foreign bank accounts, foreign shares, mutual funds, RSUs, ESOPs, even a signing authority on someone else's foreign account.

It's not optional, and it's not the same as reporting your capital gains. Even if you haven't sold a single share, if you held foreign assets during the year, you must report them.

Who Needs to File It?

Per the Income Tax Department's own guidance, if you're a Resident and Ordinarily Resident in India, you must disclose every foreign asset or account in which you're a legal owner, beneficial owner, or beneficiary — held at any point during the relevant calendar year. This covers:

●       Salaried employees with US RSUs or ESOPs

●       Anyone who bought international stocks (Apple, Google, Tesla, etc.)

●       People with a foreign bank account, even a dormant one

●       Freelancers with balances held abroad

●       Returning NRIs with an overseas pension fund

●       Anyone with signing authority on someone else's foreign account

Schedule FA does not need to be filled if you're classified as “not ordinarily resident” or “non-resident.”

One important catch: Schedule FA is available only in ITR-2, ITR-3, ITR-5, ITR-6, and ITR-7. The Income Tax Department has explicitly clarified that if you hold foreign assets, you should not file ITR-1 or ITR-4 — these forms simply don't have the schedule.

The Calendar Year Trap

This is where most people go wrong.

Your regular income tax return follows India's financial year — April to March. But Schedule FA runs on the calendar year — January to December.

So, for your return for AY 2026-27 (income earned in FY 2025-26), you're not reporting foreign assets held between April 2025 and March 2026. You're reporting assets held between 1 January 2025 and 31 December 2025.

Example: You bought US shares in November 2025 and bought more in February 2026. For this year's Schedule FA, only the November 2025 holding matters — the February 2026 purchase gets reported next year.

Mark your calendar (literally) for this one — it trips up even experienced filers.

Is There a Minimum Value Below Which I Can Skip This?

Short answer: generally, no.

There is no minimum threshold that lets you skip the disclosure itself. Even a small balance in a foreign bank account or a few dollars' worth of stock technically needs to be reported.

There is some relief, though. As per the Union Budget 2026-27 presented in Parliament, non-disclosure of non-immovable foreign assets (i.e., excluding property) with an aggregate value less than ₹20 lakh will get immunity from prosecution, applied retrospectively from 1 October 2024. But this only protects you from the harshest consequence — it does not remove your obligation to disclose.

What Happens If You Don't Report It?

This is the part that genuinely surprises people. The Income Tax Department's own portal confirms that failure to report foreign assets and income can attract assessment, penalties up to ₹10 lakh, and prosecution under the Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015 — and this applies even if you didn't owe any extra tax.

And here's the thing — the tax department already knows. Under the Common Reporting Standard (CRS) and the US FATCA framework, India receives detailed data every year on foreign accounts held by its residents — account balances, interest, dividends, and sale proceeds — directly from foreign financial institutions. This is confirmed on the Income Tax Department's own portal. So “I forgot” rarely works as a defence anymore.

What You Need to Report

Schedule FA has separate tables (A1 to G) depending on the type of asset — foreign bank accounts, foreign equity/debt, insurance contracts, immovable property, and more. For something like US shares, you'd typically report:

●       The initial value and peak value during the calendar year

●       The closing value as on 31 December

●       Any dividend or interest credited during the year

●       Proceeds from any sale or redemption

All figures must be converted to Indian rupees using the State Bank of India's telegraphic transfer buying rate on the relevant date, as per the Income Tax Department's official guidance.

Keeping a simple running log of your foreign holdings through the year — rather than digging it all up at filing time — saves a lot of last-minute stress.

Made a Mistake or Missed It Last Year?

The Income Tax Department itself confirms that if you missed reporting foreign assets in an earlier return, you can file a revised return to correct it — but you must use a form that includes Schedule FA (not ITR-1 or ITR-4). It's a straightforward fix if caught in time, which is exactly why it's worth reviewing your last return now rather than waiting for a notice.

The Bottom Line

Schedule FA isn't complicated once you know the rules — but the two things that catch people out are the calendar-year reporting period and the assumption that small holdings don't count. Both assumptions can be expensive.

If you hold any foreign shares, RSUs, or accounts — even modest ones — it's worth having a quick conversation with your CA before filing, rather than after receiving a notice.