Top Stories Filing ITR with Foreign Assets? Here’s How to Complete FSI, TR, and FA Schedules Step-by-Step Proper disclosure of the same will help you to avoid the penalties and scrutiny ensuring the compliance such as the Black Money (Undisclosed Foreign Income and Assets) Act. Here’s the step by step guide By Navasree A.M – On November 17, 2024 11:01 am – 6 mins read If you’re having foreign assets, then you should show those while filing your Income Tax Returns ( ITR ). The income taxpayers with income from foreign sources, foreign bank accounts, or other assets outside India need to accurately complete the FSI (Foreign Source Income), TR (Tax Relief), and FA (Foreign Assets) schedules in their ITR. Proper disclosure of the same will help you to avoid the penalties and scrutiny ensuring the compliance such as the Black Money (Undisclosed Foreign Income and Assets) Act.

Here’s the step by step guide: Schedule FSI – Details of Income from outside India and tax relief Schedule FSI applies to taxpayers who are residents of India. In this schedule, you must report income accruing or arising from any foreign source. Note that this income must also be separately reflected in the head-wise computation of total income. Additionally, ensure that the relevant head of income under which such foreign source income is reported is specified in the corresponding column. Comprehensive Guide of Law and Procedure for Filing of Income Tax Appeals, Click Here Country Code: Use the International Subscriber Dialing (ISD) code of the country.

Taxpayer Identification Number (TIN): Enter the TIN of the taxpayer in the country where tax was paid. If a TIN is not allotted in that country, provide the passport number instead. Tax Relief under DTAA: If tax has been paid outside India on this foreign income and you are claiming tax relief in India, mention the applicable article of the Double Taxation Avoidance Agreement (DTAA). Form 67: Ensure details of the foreign tax credit and related income are reported in Form 67 to claim the credit. Schedule TR – Summary of Tax Relief Claimed for Taxes Paid Outside India This schedule provides a summary of the tax relief claimed in India for taxes paid abroad for each country. It summarises the detailed information provided in Schedule FSI. Country Code and TIN: In columns (a) and (b), specify the relevant country code using the ISD code and the Taxpayer Identification Number (TIN). If a TIN is not allotted, mention the passport number instead. Tax Paid: In column (c), report the tax paid outside India on the income declared in Schedule FSI. This value corresponds to the total tax paid under column (c) of Schedule FSI for each country.

Tax Relief: In column (d), enter the total tax relief available, as specified under column (e) of Schedule FSI for each country. Provision for Relief: In column (e), mention the provision of the Income-tax Act under which the tax relief is being claimed, such as section 90, section 90A, or section 91. Comprehensive Guide of Law and Procedure for Filing of Income Tax Appeals, Click Here Schedule FA – Details of Foreign Assets and Income from Foreign Sources If you are a resident in India, you are required to disclose details of foreign assets, accounts, and income in this schedule.

This schedule does not need to be filled out if you are classified as “not ordinarily resident” or a “non-resident.” You must provide details of foreign assets or accounts held at any time during the relevant calendar year ending on December 31st, including: Table A1: Foreign depository accounts Table A2: Foreign custodian accounts Table A3: Foreign equity and debt interest Table A4: Foreign cash value insurance or annuity contracts Table B: Financial interest in any entity outside India Table C: Immovable property outside India Table D: Other capital assets outside India Table E: Accounts located outside India where you are a signing authority (not reported in Tables A1 to D)

Table F: Trusts created outside India in which you are a trustee, beneficiary, or settlor Table G: Other income derived from foreign sources (not reported in Tables A1 to F) If you are a resident in India, you are required to disclose all foreign assets or accounts in which you are either a beneficial owner, beneficiary, or legal owner in Schedule FA. For this purpose: Beneficial Owner: An individual who has provided, either directly or indirectly, consideration for the asset, and where the asset is held for the immediate or future benefit (direct or indirect) of the individual or any other person. Beneficiary: An individual who derives an immediate or future benefit, directly or indirectly, from the asset, where the consideration for the asset has been provided by someone other than the beneficiary. Comprehensive Guide of Law and Procedure for Filing of Income Tax Appeals, Click Here In case you are both a legal owner and a beneficial owner, please mention legal owner in the column of  : Table A1: Disclose the peak balance, closing balance as of 31st December, and the gross interest credited to the account during the calendar year.

Convert the values into Indian currency. Table A2: Provide the peak balance, closing balance as of 31st December, and the gross amount credited to the account during the calendar year. Specify the nature of the gross amount (e.g., interest, dividend, sale proceeds, other income) from the drop-down list, and mention the respective amounts in Indian currency. Table A3: Report the initial investment value, peak value, closing value as of 31st December, gross interest paid, total gross amount credited to the account, and total gross proceeds from the sale or redemption of investments during the calendar year. Convert these values into Indian currency.

Table A4: Disclose the cash or surrender value of the insurance or annuity contract as of 31st December, along with the total gross amount paid or credited with respect to the contract. Convert these values into Indian currency. Table B: Provide the value of total investment at cost held at any time during the calendar year, along with the nature and amount of income accrued. Convert the values into Indian currency. Specify the income chargeable to tax in India (if applicable) and mention the relevant ITR schedule where the income has been declared. Comprehensive Guide of Law and Procedure for Filing of Income Tax Appeals, Click Here For the purposes of disclosure in table B, financial interest would include, but would not be limited to, any of the following cases:- The resident being the owner of record or legal title holder of a financial account, regardless of beneficiary status. The owner of record or title holder may be: An agent, nominee, or attorney acting on behalf of the resident.

A corporation where the resident owns any share or voting power. A partnership in which the resident holds an interest in profits or capital. A trust in which the resident has beneficial or ownership interest. Any other entity in which the resident holds voting power or equity interest. Table C: Disclose the value of total investment in immovable property held at any time during the calendar year, along with the nature and amount of income derived. Convert these into Indian currency. Specify the income chargeable to tax in India, if any, and the relevant ITR schedule where the income has been reported. Table D: Provide the value of total investment in other capital assets held at any time during the calendar year and the income derived. Convert these into Indian currency.

Mention the income chargeable to tax in India and the relevant ITR schedule for reporting. For Table D, capital assets include financial assets not reported in Table B, but exclude stock-in-trade or business assets included in the Balance Sheet. Table E: Report the peak balance or total investment at cost in accounts where you have signing authority, during the calendar year. Only foreign accounts not already reported in Tables A1 to D should be included.

If the income from these accounts is taxable in India, specify the chargeable amount and the relevant ITR schedule. Table F: Provide details of trusts created under the laws of a foreign country in which you are a trustee, beneficiary, or settler. If income from such trust is taxable in India, specify the chargeable amount and the relevant ITR schedule. Table G: Disclose any other income derived from foreign sources not included in Tables A1 to F. If this income is taxable in India, specify the chargeable amount and the relevant ITR schedule. Comprehensive Guide of Law and Procedure for Filing of Income Tax Appeals, Click Here Explanations: For the purpose of this Schedule, for Assessment Year (AY) 2024-25, the calendar year ending on 31st December refers to the period from 1st January 2023 to 31st December 2023, concerning foreign assets or accounts.

The exchange rate for converting the peak balance, value of investment, or foreign-sourced income into Indian currency will be the “telegraphic transfer buying rate” as on the date of the peak balance, investment date, or the closing date of the calendar year (31st December). The “telegraphic transfer buying rate” for a foreign currency refers to the exchange rate set by the State Bank of India (SBI) for purchasing the currency, based on the guidelines issued by the Reserve Bank of India (RBI) for telegraphic transfers. Clarification: Even if you have reported foreign assets in previous years, you are required to report them again in Schedule FA, if applicable, in Schedule AL.