Schedule FA — how to report US stocks, ETFs & RSUs (foreign assets) in your ITR

Key takeaway

Schedule FA is a disclosure, not a tax calculation — but it's the one people get wrong most often, and the penalties are the harshest in the ITR. If you're a resident and you hold even one US share or ETF, you must report it, whether or not you earned anything and whether or not you sold. Get the calendar year and the exchange rate right and the rest is mechanical.

Who must file Schedule FA

Any resident and ordinarily resident (ROR) individual who, at any time during the year, held foreign assets — shares, ETFs, mutual funds, RSUs/ESPPs, a foreign bank/broker account, or any beneficial interest abroad. Buy-and-hold counts: you report the holding even if you never sold and earned no dividend. NRIs and RNORs generally don't file FA for foreign assets. You'll be on ITR-2 (or ITR-3), never ITR-1.

The three foreign schedules — FA, FSI, TR

• Schedule FA — the assets themselves (holdings, accounts, peak and closing values).
• Schedule FSI — foreign-source income (dividends, capital gains) that you're also offering to tax in India.
• Schedule TR — the tax relief (foreign tax credit) claimed against that income, backed by Form 67.

Trap #1 — it's the CALENDAR year, not the financial year

Schedule FA is reported for the relevant accounting period, which for most foreign assets is the calendar year (1 January – 31 December) ending during the financial year. So for AY 2026-27 (FY 2025-26), you report the position for calendar year 2025 — the peak and closing balances of Jan–Dec 2025, not April–March. Mixing this up is the most common FA error.

Trap #2 — use the SBI TT buying rate, not your platform's rate

Convert every figure to INR using the State Bank of India Telegraphic Transfer (TT) buying rate on the relevant date — the peak-value date and the 31 December closing date for FA; the transaction date for income/gains. Your broker's or app's exchange rate will differ and is not accepted — always use the SBI TT reference rate.

What to enter for US stocks / ETFs

Held through a foreign broker (e.g. Interactive Brokers, Vested), you typically fill:

• Foreign depository/custodial account table — the broker account: opening date, peak balance, closing balance, and gross amount credited (dividends/sale proceeds) during the year.
• Foreign equity & debt interest table — each holding: name of entity, address/country, date acquired, initial value (cost), peak value, closing value, and total gross income from it.
• ETFs go under the equity/units head — the "nature" is the ETF/fund; report it like a share holding.
• Fractional shares — report them as held, decimals and all; there's no minimum.

RSUs and ESPPs

Vested RSUs/ESPP shares are foreign assets — report the shares in Schedule FA once vested/held. Their perquisite value at vesting is salary income (and appears in FSI where relevant), and the capital gain on sale (sale price minus the value taxed at vesting) goes in the Capital Gains schedule. Shares vesting on different dates are each reported with their own acquisition date and values. Where tax was withheld abroad (e.g. 30% at vesting or on dividends), claim the foreign tax credit.

Broker commissions, wire charges & exchange differences

• Brokerage/commission and wire-transfer charges on a sale are transfer expenses, deductible from the capital gain — so a $5 commission reduces your taxable gain.
• Small exchange-rate differences between your platform and the SBI rate are expected — always report using the SBI TT rate, and keep your workings.

Step-by-step — how to fill it

1. Download your broker's calendar-year (Jan–Dec) statement and dividend summary. This is the source for every FA figure — don't use the April–March statement.
2. For each holding, note the date first acquired, the initial cost, the highest value during the year (peak), and the value on 31 December.
3. Convert each amount to INR at the SBI TT buying rate on that specific date, and record the rate you used.
4. Enter the broker account in the depository/custodial table, and each share/ETF in the equity table.
5. Put the year's dividends and capital gains in Schedule FSI, the matching foreign tax in Schedule TR, and file Form 67.
6. Cross-check that the gains you show in the Capital Gains schedule reconcile with the FSI figures.

Common mistakes to avoid

• Using the financial year instead of the calendar year for FA values — the single biggest error.
• Using the platform's exchange rate instead of the SBI TT rate.
• Skipping FA because "I didn't sell" — holding alone triggers the disclosure.
• Reporting the asset but forgetting FSI/TR for the dividend/gain, or missing Form 67 for the credit.
• Ignoring vested RSUs that are sitting in your foreign broker account.

Why this matters — the penalties

Schedule FA sits under the Black Money (Undisclosed Foreign Income and Assets) Act. Failing to disclose a foreign asset can attract a penalty of ₹10 lakh (per year of non-disclosure), separate from any tax on the income. This is why even a tiny, income-free holding must be reported — the cost of omission dwarfs the effort of disclosure.

How disclosure links to your actual tax

It helps to see how the pieces fit together. Schedule FA proves what you own abroad; it does not by itself create tax. The tax comes from the income and gains those assets produce, which you report in the normal Capital Gains and Other Sources schedules and mirror in FSI. If that same income was taxed abroad, Schedule TR plus Form 67 gives you credit so you aren't taxed twice. So a resident with US stocks typically has three touch-points in one return: the holding in FA, the dividend/gain in the income schedules and FSI, and the US tax as a credit in TR. Keeping your broker's calendar-year statement, dividend summary and the SBI TT rates in one folder makes the whole return straightforward — and defensible if the department ever asks.

Forms & records

• ITR-2 (or ITR-3) with Schedule FA + FSI + TR.
• Form 67 for the foreign tax credit, filed before the ITR.
• Your broker year-end statement (calendar year), dividend/1042-S or equivalent, and the SBI TT rate references used.

Frequently asked questions

Is Schedule FA mandatory for buy-and-hold foreign shares?

Yes. A resident and ordinarily resident must disclose every foreign holding in Schedule FA regardless of income and even if never sold. Non-disclosure attracts penalties under the Black Money Act.

Which period does Schedule FA use — calendar year or financial year?

The calendar year (1 January to 31 December) ending during the financial year. For AY 2026-27 (FY 2025-26), report the calendar year 2025 position — peak and closing values of Jan–Dec 2025.

Which exchange rate do I use for Schedule FA?

The SBI Telegraphic Transfer (TT) buying rate on the relevant date — peak-value date and 31 December closing date for assets, transaction date for income. Your platform's exchange rate is not accepted.

Can I deduct US broker commissions and wire charges?

Yes — brokerage/commission and transfer charges on a sale are transfer expenses deductible from the capital gain. Report income and gains using the SBI TT rate.

Do I report RSUs and ESPP shares in Schedule FA?

Yes. Once RSUs vest or you buy ESPP shares, they are foreign assets held in your foreign broker account and must be reported in Schedule FA, each with its own acquisition date and values. The perquisite at vesting is salary income, and the later sale is a capital gain — with a foreign tax credit for any tax withheld abroad.