Schedule FA is the section of your ITR where you declare foreign assets. For RSU holders, this means disclosing your vested shares and their values every year you hold them — not just the year they vested, not just the year you sell.
This guide covers what goes in, how the numbers are calculated, and why the penalty for getting it wrong has nothing to do with how much tax you owe.
Table of contents
- What is Schedule FA?
- Does it apply to you?
- Schedule FA runs on the calendar year, not the financial year
- What do you disclose?
- How do you value the holding?
- What if you sold shares during the year?
- What about unvested RSUs?
- What is the penalty for not filing?
- How Paasa helps
What is Schedule FA?
Schedule FA (Foreign Assets) is a mandatory disclosure section in ITR-2 and ITR-3. It requires Indian tax residents to report any foreign asset they held at any point during the year.
It is a disclosure schedule, not a tax schedule. Filling it in does not by itself create a tax liability. But not filling it in, or filling it in incorrectly, has its own consequences, separate from any tax you may or may not owe.
Does it apply to you?
If your RSUs have vested and the shares are sitting in your brokerage account, yes.
It does not matter whether you sold any shares. It does not matter whether the value went up or down. It does not matter whether you received any dividends. If you held the shares at any point during the relevant period, you disclose them.
Schedule FA runs on the calendar year, not the financial year
This is the most commonly misunderstood part of Schedule FA, and it catches a lot of people off guard.
For most of your ITR, you report income from April 1 to March 31. Schedule FA works differently. It asks you to disclose foreign assets held between January 1 and December 31 of the calendar year that falls within the financial year.
For ITR filed for AY 2026-27 (FY 2025-26), Schedule FA covers January 1, 2025 to December 31, 2025.
This means:
- Shares that vested in February 2025 need to be disclosed, even though February 2025 falls outside the Indian financial year for AY 2025-26
- If you sold all your shares in November 2025, you still disclose them — you held them during the calendar year
- The capital gains from that sale are reported for FY 2025-26 as usual, but the asset itself is disclosed in Schedule FA for the January–December 2025 window
What do you disclose?
Foreign equity shares — including RSU shares — are reported in Table A3 of Schedule FA (Details of Foreign Equity and Debt Interest).
For each holding, you provide:
- Country where the company is listed or incorporated
- Name of the entity (e.g. Alphabet Inc.)
- Date of acquiring the interest — this is the vest date for each tranche
- Initial value — the cost of acquisition in INR (the FMV on vest date, which matches the perquisite value in your Form 16)
- Peak value during the calendar year — the highest market value your holding reached at any point during January–December, converted to INR
- Closing value as of December 31 — the market value of the shares on December 31, converted to INR
- Income earned during the calendar year (dividends, if any)
If you have shares from multiple vest dates, each tranche is reported separately with its own vest date and initial value.
How do you value the holding?
Initial value is straightforward — it is the cost of acquisition for each tranche, which is the vest-day FMV converted to INR using the SBI TTBR on the last day of the preceding month. This is the same figure in your Form 16. How your employer calculates this and where it appears in Form 16
Peak value is the highest market value your total holding reached at any point during January 1 to December 31. Convert the share price on the date of peak value to INR using the SBI TTBR for that date.
Closing value is the market value of your shares on December 31. Convert using the SBI TTBR on December 31.
Example
Continuing from the Form 16 example: 25 shares vested on June 10, 2025, and another 25 vested on December 10, 2025. You hold all 50 shares through December 31, 2025.
| Amount | Note | |
|---|---|---|
| Tranche 1 — initial value | ₹3,59,125 | 25 shares, vest June 10, 2025 |
| Tranche 2 — initial value | ₹6,75,675 | 25 shares, vest December 10, 2025 |
| Peak value | ₹14,10,400 | 50 shares × $328 × ₹86.00, approximate peak in November |
| Closing value (December 31, 2025) | ₹13,50,200 | 50 shares × $314 × ₹86.00 |
Each tranche is entered as a separate line in Table A3 with its own vest date and initial value. The peak and closing values reflect the total holding at those points.
What if you sold shares during the year?
You still disclose them.
If you held shares at any point during the January–December window, they go in Schedule FA. The closing value field will reflect only the unsold shares remaining on December 31. If you sold everything before December 31, the closing value is zero — but the disclosure itself is still required.
The capital gains from the sale are reported separately under Schedule CG as usual. How capital gains are calculated when you sell
What about unvested RSUs?
Unvested RSUs are not disclosed in Schedule FA.
Unvested shares are not an asset you own. They are a promise of future shares, conditional on you continuing to meet your vesting schedule. The obligation to disclose starts on the date the shares vest and land in your brokerage account.
What is the penalty for not filing?
Up to ₹10 lakh per year under the Black Money (Undisclosed Foreign Income and Assets) Act.
This penalty is assessed per year of non-disclosure and is completely independent of whether you underpaid any tax. You can owe zero additional tax and still face the full penalty for not filing Schedule FA.
If you have missed Schedule FA in previous years, file updated returns for the years that are still open. The window to file an updated return (ITR-U) is currently open for several prior assessment years.
Note: The Income Tax Department receives data on foreign holdings through global information-sharing frameworks including FATCA and CRS. Non-disclosure is increasingly unlikely to go unnoticed.
How Paasa helps
Paasa records every vest date, share count, and conversion rate as transactions happen. When it is time to file, your initial values, peak values, and closing values are already calculated — you do not need to reconstruct the numbers from a broker statement at the end of the year.
