How you fix a missed Schedule FA year depends on the year and on what you missed. The latest year, FY 2025-26, can be corrected with a revised return until 31 March 2027. Older years with missed income can use an updated return (ITR-U) within 48 months. If you missed only the Schedule FA entry and no income, ITR-U often will not work, so the options are FAST-DS at ₹1 lakh, by 31 December 2026, or the ₹20 lakh relief.
Table of contents
- Step 1: Which years are lapse years?
- Step 2: What did you miss in each year?
- Step 3: Which fix works for each year?
- RSUs, ESPP and ESOPs left out of Schedule FA
- US stocks bought under LRS and never reported
- A foreign broker account you opened but never funded
- You reported the last two years but not the ones before
- Records to gather before you fix anything
Step 1: Which years are lapse years?
A lapse year is any year in which you were resident and ordinarily resident (ROR) and held a foreign asset that is missing from that year's Schedule FA. Years when you were NRI or RNOR do not count. For how to check your status year by year, see Resident vs RNOR vs non-resident.
Schedule FA follows the calendar year, not the financial year, so match each calendar year you held the asset to the return it belongs in (Schedule FA for RSU holders):
| Calendar year you held the asset | Return it belongs in | Income year |
|---|---|---|
| 2020 | AY 2021-22 | FY 2020-21 |
| 2021 | AY 2022-23 | FY 2021-22 |
| 2022 | AY 2023-24 | FY 2022-23 |
| 2023 | AY 2024-25 | FY 2023-24 |
| 2024 | AY 2025-26 | FY 2024-25 |
| 2025 | AY 2026-27 | FY 2025-26 |
Each year is a separate obligation. Getting one year right does not fix another.
Step 2: What did you miss in each year?
For each lapse year, note which of three gaps applies, because each one is fixed differently:
- Only the asset. The shares or account were missing from Schedule FA, but they were bought with money already taxed in India, or earned while you were NRI, and there was no income you failed to report.
- Income as well. Dividends, interest or sale gains from the asset never reached the return.
- An unexplained source. You cannot show where the money to buy the asset came from.
Most people who missed Schedule FA have the first gap, and many also have a small amount of the second.
Step 3: Which fix works for each year?
| Return | What you missed | Fix |
|---|---|---|
| AY 2026-27 (FY 2025-26) | Anything | Revised return by 31 March 2027 |
| AY 2022-23 to AY 2025-26 | Income, with or without the asset | ITR-U for that year, or FAST-DS Row 1 (60% of the income) |
| AY 2022-23 to AY 2025-26 | Only the asset, no income | ITR-U is usually not possible; FAST-DS Row 2 (₹1 lakh), or the ₹20 lakh relief if it applies |
| AY 2021-22 and earlier | Anything | FAST-DS only, by 31 December 2026 |
An updated return is a full return, so when you file one to report missed income, include the Schedule FA entries for that year in it too.
Note: ITR-U cannot be filed if it lowers your tax or raises your refund. It exists to report extra income, which is why a year with only a missing Schedule FA entry usually has no ITR-U route. For ITR-U's additional tax by year and how the ₹20 lakh relief works, see what to do after the FAST-DS email. For FAST-DS itself, see FAST-DS 2026 explained.
RSUs, ESPP and ESOPs left out of Schedule FA
This is the most common case. RSU and ESPP shares are taxed as salary when they vest or are bought, so the shares themselves come from income already taxed in India. If you left them out of Schedule FA, the gap is usually an asset-only gap. Any dividends that never reached your return are a separate income gap.
Example. Suppose your RSUs, taxed through payroll, are worth ₹12 lakh. You left them out of Schedule FA for AY 2023-24 and AY 2024-25, and started reporting them from AY 2025-26. In those two years you also received ₹8,000 of dividends, on which 25% US tax was withheld, and you never reported them.
The shares. At ₹12 lakh, they are under ₹20 lakh, so the Black Money Act penalty and prosecution for leaving them out no longer apply from 1 October 2024. CBDT has not said how this relief applies to returns filed before that date, which is the one open point here.
The dividends. You can fix them through FAST-DS Row 1 or through ITR-U for each of the two years:
| Route | How it is worked out | Approximate cost |
|---|---|---|
| FAST-DS Row 1 | 60% of ₹8,000, with no credit for US tax | ₹4,800 |
| ITR-U for both years | Tax at 30% is ₹2,400, less ₹2,000 credit for the US tax (claimed with Form 67), so ₹400, plus interest and 50% to 60% additional tax on the tax and interest | Under ₹1,000 plus interest |
The result: ITR-U is far cheaper here, because it allows credit for the US tax already withheld
ITR-U lets you claim foreign tax credit by filing Form 67 with the updated return. FAST-DS gives no credit at all, so for small amounts of dividends the updated return usually wins. FAST-DS makes more sense when the asset is above ₹20 lakh and you also want Black Money Act immunity for the Schedule FA gap, as in the RSU example in what to do after the FAST-DS email.
Edge cases RSU and ESOP holders ask about
- Unvested RSUs. These are not yours yet and do not go in Schedule FA. See Schedule FA for RSU holders.
- Sell-to-cover shares. Shares sold at vesting to pay the tax were still yours for a moment, so that lot belongs in that year's Schedule FA.
- Shares sold before 31 March 2026. Years you held them are still lapse years. FAST-DS values a sold asset at the higher of its cost and its sale price (rule 3(2)).
- Exercised ESOPs. Once exercised, the perquisite is taxed as salary (section 17 of the 1961 Act) and the shares are treated like RSU shares.
- Vested but unexercised ESOPs. No tax arises until you exercise. Whether vested options must be shown in Schedule FA as a financial interest has no CBDT answer, so take advice if the value is large.
- The plan account was left out. If the shares were in Table A3 but the brokerage or plan administrator account holding them was missing from Table A2, that year is still incomplete. With no income missing, ITR-U usually cannot fix it; whether it needs FAST-DS depends on the value, so take advice.
Note: Accounts at plan administrators such as E*TRADE, Fidelity or Morgan Stanley at Work are foreign custodial accounts and belong in Table A2.
US stocks bought under LRS and never reported
US stocks or ETFs bought with money you sent abroad under the Liberalised Remittance Scheme (LRS) were bought with your own money, which in most cases was already taxed in India. So the shares themselves are usually an asset-only gap, and sales or dividends you did not report are an income gap.
What matters most is whether you sold during those years:
- You bought and held, with small dividends. The asset side follows the ₹20 lakh relief if the total is ₹20 lakh or less. Report the dividends through ITR-U for open years, claiming the US tax withheld with Form 67, or through FAST-DS Row 1.
- You traded and made gains. The gains are untaxed foreign income. ITR-U for open years (FY 2021-22 onward) or FAST-DS Row 1 are the two routes. There is no US tax on these gains to set off, because the US does not tax capital gains of non-resident investors on US shares in most cases, so the ITR-U advantage is smaller than for dividends.
- You traded before FY 2021-22. Those years are past the ITR-U window, so FAST-DS is the only voluntary route for any untaxed gains from them.
Note: The money you sent under LRS is reported by your bank and shows up in AIS, so the department can usually see that you invested abroad even when foreign data for that year is thin.
A foreign broker account you opened but never funded
Schedule FA asks for accounts you held at any time during the year, so an account that was open belongs there even if it never held money. If you opened a foreign broker account and never funded it:
- There is no income to report and no ITR-U route.
- The value is nil, so it sits well within the ₹20 lakh relief.
- FAST-DS Row 2 would cost a flat ₹1 lakh to declare an account worth nothing, which rarely makes sense.
The practical fix is to report the account in your next return while it stays open, or close it so it drops out of Schedule FA.
You reported the last two years but not the ones before
This is common, and it does not fix the earlier years. Each year's return is a separate obligation, and reporting an asset in recent returns makes the gap in earlier ones easier to see, not harder.
Work through the earlier years with the three steps above:
- List the years you were ROR and held the asset before you started reporting.
- Check whether any income from those years is missing.
- Use the per-year fix table: ITR-U where there is missed income in an open year, the ₹20 lakh relief or FAST-DS Row 2 for asset-only gaps, and FAST-DS alone for FY 2020-21 and earlier.
Records to gather before you fix anything
Whichever route you use, the figures come from the same records. Collect them for every lapse year before you file:
- Vesting, purchase or exercise confirmations for RSUs, ESPP and ESOPs
- Year-end and monthly brokerage or plan statements, for opening, peak and closing values
- Dividend and withholding statements, for income and the foreign tax already paid
- Sale confirmations, for capital gains
- Your Form 16 for each year, to show the perquisite was taxed as salary
- The returns you filed, to see exactly what was missing
FAST-DS needs values as on 31 March 2026 on top of these, and a sold asset needs its sale price (FAST-DS Rules, rule 3). If your holdings are at Interactive Brokers, see how to get Schedule FA data from IBKR.
About Paasa
Paasa is a global investing platform built for Indian and Asian investors. It gives anyone direct access to stocks, ETFs and UCITS funds on their home exchanges across the US, Canada, the UK, Germany, France, Switzerland, the Netherlands, South Korea, Japan, Hong Kong and Singapore.
- Move RSUs out of the plan account: many RSU holders transfer vested shares from their employer's plan administrator to Paasa, so their holdings and diversified investments sit in one account and one set of statements.
- One statement for every year's Schedule FA: holdings, dividends and trades across all markets come from a single source, so future years are simpler to report correctly.
- A dedicated relationship manager: one point of contact who can help you pull together the statements your tax adviser needs for past years.
