If your company or LLP has ever taken foreign investment or invested abroad, the Reserve Bank of India expects an annual Foreign Liabilities and Assets (FLA) return from you, even in a year with no new deals. Miss it, and a routine statistical filing turns into a FEMA contravention with day-on-day consequences. This guide explains who must file, what the FLAIR portal asks for, the 15 July deadline, and how to keep the return clean and on time.
What is the FLA return?
The FLA return is an annual statement that Indian-resident entities submit to the Reserve Bank of India, declaring the foreign investments appearing on both sides of their balance sheets as on 31 March. It is a position return, not a transaction return: what matters is what is outstanding at year-end, not whether a fresh deal happened. The RBI aggregates this data to compile India’s Balance of Payments and International Investment Position, so the filing carries a macroeconomic purpose well beyond your own books.
FLA reports the stock position, not a flow
Who must file the return?
The filing obligation rests solely on the Indian entity, not the foreign investor. According to RBI guidance, any Indian resident entity with outstanding Foreign Direct Investment (FDI) or Overseas Direct Investment (ODI) as of 31 March must submit the return. Because the requirement is based on the year-end position, a filing is mandatory even if no new investments occurred during the year. The following entities must file if they hold outstanding FDI or ODI:
- Companies Incorporated in India: that is, every private and public company registered in India, whether foreign-owned or with only a minority non-resident shareholder.
- Limited Liability Partnerships: The LLP registered under the Limited Liability Partnership Act, 2008 — LLPs have been permitted to receive FDI since 2015, and once they do, the FLA applies to them too.
- Others, including AIF: Others, including SEBI-registered Alternative Investment Funds (AIFs), partnership firms, and Public-Private Partnerships (PPPs), where foreign investment is outstanding.
A useful test before you assume you are out of scope: look at your 31 March shareholding and your overseas investment ledger, not your transaction history for the year. If a foreign name still appears on the cap table, or an overseas subsidiary still sits in your books, you are almost certainly in.
A note for foreign-owned structures
A wholly owned subsidiary of a foreign parent files the FLA every year for as long as that foreign holding exists. The same is true of an Indian company with a single overseas investor. If you are weighing how to structure an India presence, our explainer on the difference between a subsidiary company and a branch office sets out which structures are subject to FDI reporting in the first place.
When the FLA does not apply
Not every entity that has ever seen a non-resident name on its register must file. The exemptions turn entirely on the 31 March position, and they are narrow — read them strictly, because “we thought we were exempt” is not a defence the RBI accepts. The exemption applies only where there is genuinely no outstanding foreign liability or asset on the reference date; a single outstanding rupee of qualifying foreign investment pulls you back into the filing net for that year.
| An entity is not required to file the FLA return in these situations: | ||
|---|---|---|
| The entity has no outstanding FDI or ODI as of 31 March for the reporting year. | It holds only share application money with no shares allotted to non-residents and no other outstanding foreign investment as of 31 March. | Shares were issued only on a non-repatriable basis, which FEMA treats as domestic investment rather than foreign liabilities. |
Exit scenarios also impact filing:
An entity is exempt if all non-resident shares were transferred to residents before 31 March, leaving no foreign interest outstanding. Timing is critical: an exit finalised on 1 April means the investment remained outstanding as of 31 March, necessitating a return.
The legal basis under FEMA
FLA reporting is an exchange-control obligation, so it traces back to the Foreign Exchange Management Act, 1999 (FEMA), not the Companies Act or the income-tax law. The RBI introduced the return itself through A.P. (DIR Series) Circular No. 45 dated 15 March 2011, which created the annual FLA filing and replaced the older share-by-share approach. Understanding which provision governs which step is what lets you respond correctly when the RBI raises a query months after submission.
| The framework has a few load-bearing pieces worth knowing by name. | ||
|---|---|---|
| No | Key Legislative Change | Description |
| 1 | A.P. (DIR Series) Circular No. 45 dated 15 March 2011 | The circular that notified the FLA return under FEMA. In plain terms, this is where the annual filing obligation was born. |
| 2 | Foreign Exchange Management (Mode of Payment and Reporting of Non-Debt Instruments) Regulations, 2019, notified vide Notification No. FEMA 395/2019-RB dated 17 October 2019 | The current rulebook for reporting foreign investment in equity instruments. Regulation 4 is the source of the obligation to report inward investment to the RBI |
| 3 | Section 13 of FEMA, 1999 | The penalty section. If you default, this is the provision under which the amount is computed. |
| 4 | Section 15 of FEMA, 1999, read with the Foreign Exchange (Compounding Proceedings) Rules, 2024 | The route by which a contravention is settled (compounded) rather than litigated |
| 5 | A.P. (DIR Series) Circular No. 16 dated 30 September 2022 | The circular that fixed a flat Late Submission Fee for routine reporting delays, such as the FLA. In plain terms, this is the inexpensive way to regularise a short delay before it escalates. |
| The practical takeaway is that the FLA is a statistical return with real teeth. The data collection is benign; the consequence of ignoring it is governed by the same penalty machinery that applies to any FEMA breach. | ||
Inside the five-part FLA Form
The online form is organised into five sections, and the entity completes the first four while the fifth is generated for it. The reference period is always 1 April to 31 March, regardless of the entity’s own accounting year — so a company that closes its books in December must still report on a March-end basis, using internal assessments where needed. Knowing what each section wants in advance is the difference between a thirty-minute filing and a week of back-and-forth with validation errors. Here is what each section captures:
| No | Section | What it captures | Description |
|---|---|---|---|
| 1 | Section I | Identification | Entity name, PAN, CIN or LLPIN, contact details, NIC-2008 industry code and nature of business |
| 2 | Section II | Financial details | Paid-up capital, profit before and after tax, reserves and surplus, sales and turnover, employee count |
| 3 | Section III | Foreign liabilities | Inward FDI, non-resident equity holdings, reinvested earnings of foreign investors, and trade credit from overseas. |
| 4 | Section IV | Foreign assets | ODI in overseas subsidiaries or joint ventures, overseas loans extended, and portfolio investment abroad |
| 5 | Section V | Variation report | An auto-generated, read-only comparison of the current year against the previous year |
A point that catches first-time filers: figures are entered in ₹ lakh, not in full rupees. An amount of ₹29,00,000 is entered as 29, not as 29,00,000. Foreign-currency values are converted to the RBI reference rate as on 31 March, and the portal itself computes the market valuation of listed and unlisted equity, so those numbers should not be entered manually.
Documents to keep ready
Gathering the right papers before you log in saves you from mid-filing validation failures, which are the single most common reason a return stalls. None of these is filed as an attachment in the usual sense — the FLA is a data-entry return — but you need each document open in front of you to enter accurate figures and to register the first time. A clean previous-year return is especially useful because the portal compares year-on-year and flags large unexplained swings. The portal auto-computes equity valuations, so manual entry is not required.
List of Documents
- Audited financial statements (as of 31 March)
- PAN for the entity and authorised filer
- Certificate of incorporation/registration
- Authority and verification letters (RBI format)
- Previous year’s FLA return for reconciliation
- Shareholding pattern (non-resident equity %)
- FDI and ODI details
FLAIR Portal Submission
Filings must be completed online via the FLAIR portal. The email-and-Excel method is retired for companies and LLPs; only SEBI-registered AIFs still use a manual template via email. Entities deal directly with the RBI without intermediaries.
Filing on the FLAIR portal
All FLA filings are made online through the RBI’s Foreign Liabilities and Assets Information Reporting (FLAIR) portal at flair.rbi.org.in. The older email-and-Excel route has been retired for companies and LLPs; the only exception is SEBI-registered AIFs, which still email a completed FLA template to the RBI to obtain and submit the format. There is no banking intermediary in the process — the entity deals directly with the RBI through the portal, which keeps the timeline in your hands.
The filing runs in a predictable sequence:
Step 1: Register (first-time filers only): Choose the correct entity type, enter the entity and authorised person details, and upload the signed authority and verification letters. Login credentials arrive by email; the initial password must be changed within 24 hours.
Step 2: Log in to FLAIR Portal: The authorised person signs in with the RBI-issued credentials and an OTP sent to the registered email.
Step 3: Open the FLA form. Select the relevant financial year, then start the FLA online form. Section I identification fields are pre-filled from registration.
Step 4: Enter financial details. Complete Section II: paid-up capital, profit, reserves, turnover and employee count — and indicate whether the figures are audited or provisional.
Step 5: Add foreign liabilities and assets. Enter foreign investor details in Section III and any overseas investment, loans or trade credit in Section IV; skip what does not apply.
Step 6: Validate and submit. Run the portal’s validation, fix every flagged mismatch, review the summary, and submit. Save the acknowledgement — the RBI does not send a separate confirmation.
Step 7: Revise if needed. To correct a filed return, raise a revision request through the portal for RBI approval, then refile.
Step 8: Revise if needed. To correct errors, request RBI approval via the portal and refile.
Due dates and revisions
The FLA deadline is 15 July annually, reporting the position as of 31 March. For FY 2025-26, the return is due 15 July 2026. A pending audit never justifies missing this date; entities must file accurate provisional figures by 15 July and submit a revised return with audited numbers by 30 September. While the RBI sometimes grants extensions, such as the 31 July 2025 extension for FY 2024-25, these are concessions. Treat 15 July as the firm deadline.
Due Dates & Revision Guidelines
The annual deadline for the FLA return is 15 July, capturing the entity’s financial position as of 31 March. For the upcoming FY 2025-26 cycle, the submission is due by 15 July 2026. It is critical to note that an incomplete audit is not a valid reason for delay; companies should submit the return using provisional data by the July deadline and later provide a revised version with audited figures by 30 September. Although the RBI may occasionally offer extensions—such as the 31 July 2025 extension for FY 2024-25—these are exceptions. 15 July should always be treated as the definitive cutoff.
Consequences of Non-Compliance
🚨 Missing the filing deadline constitutes a FEMA contravention rather than a minor administrative error. Costs for regularisation escalate over time, and the window for the simplified late-fee option is limited. The position breaks down as follows:
| No | Situation | Consequence |
|---|---|---|
| 1 | Late filing, regularised through the late-fee route | Flat Late Submission Fee of ₹7,500 per return |
| 2 | Default where the contravention amount is quantifiable | Up to three times the amount involved, under Section 13, FEMA |
| 3 | Default where the amount is not quantifiable | Up to ₹2,00,000 |
| 4 | Continuing default | A further ₹5,000 per day for the period the default continues |
Two limits are critical. First, the Late Submission Fee (LSF) for the FLA is a flat ₹7,500 per return per A.P. (DIR Series) Circular No. 16 dated 30 September 2022; as a periodical return without fund flow, it attracts a fixed rather than amount-linked fee. Second, the LSF option is only available for 3 years from the original due date, and the issued advice must be paid within 30 days of that date. Beyond three years, entities must use FEMA Section 15 compounding or Section 13 adjudication, both of which are significantly more expensive and time-consuming.
Frequently Asked Questions
Is there any government fee to file the FLA return?
No. The FLAIR portal is free, and no government fees apply for timely FLA return filings. Costs only arise from delays: the RBI levies a flat ₹7,500 Late Submission Fee per return. Failure to file or pay this fee results in penalties under Section 13 of FEMA, 1999. Filing by the July deadline ensures compliance without avoidable, escalating costs.
What is the FLA return due date for FY 2025-26?
The FLA return for FY 2025-26 is due on 15 July 2026, based on the position as of 31 March 2026. This standard annual deadline applies even if accounts are not yet audited. If filing with provisional figures, a revised return with audited numbers must be submitted by 30 September 2026. While the RBI occasionally grants extensions, such as moving the FY 2024-25 date to 31 July 2025, you should aim to file by 15 July.
Do we still file if no fresh FDI came in this year?
The FLA is a position return, meaning the obligation depends on outstanding assets or liabilities as of 31 March, regardless of new transactions. If foreign shares or overseas subsidiaries remain on your books from previous years, you must file. This duty only ceases when the balance sheet shows zero foreign holdings. Mistakenly assuming a quiet year exempts an entity is a common and heavily penalised error.
Can the FLA return be revised after submission?
Yes. If you used provisional figures, you must submit a revised return with audited numbers by 30 September. To revise, the authorised person submits a request via the FLAIR portal; once the RBI approves it, the return can be edited and refiled. This process also corrects genuine errors. Since the portal prohibits direct editing after submission, ensure you have your acknowledgement and reference number ready for the request.
Is a Digital Signature Certificate needed for FLA filing?
The FLAIR portal uses RBI login credentials and email OTPs for authentication. As requirements for a Class 3 Digital Signature Certificate vary, verify the current rules on the portal or in the user manual before starting. Registering well ahead of the 15 July deadline ensures sufficient time to resolve any credential or signature issues.
What happens if a foreign investor exits during the year?
Filing depends on the March 31 position. If all foreign shares were transferred to an Indian resident by year-end with no other foreign investment outstanding, the entity is exempt. However, if the exit occurs after March 31, the investment remains outstanding on the reference date, requiring a return. The obligation only ceases when the March 31 balance sheet reflects no foreign liabilities or assets.
Is FLA the same as the APR for overseas investment?
No. They are distinct filings with different deadlines. The FLA return, reporting overall foreign positions, is due by 15 July on the FLAIR portal. The Annual Performance Report (APR), covering specific overseas ventures under the 2022 Directions, is due by 31 December. Entities with outstanding ODI must file both separately.
Conclusion
The FLA return requires annual reporting of FDI and ODI as of 31 March, with the return due by 15 July. Most defaults result from misinterpreting filing triggers or confusing the FLA with the APR. To ensure compliance, maintain accurate investment records and file early. For expert assistance with FLAIR registration and filings, our FLA return filing service and compliance support are available to keep your regulatory calendar on track.
In This Article
Author Bio
Setindiabiz Editorial Team is a multidisciplinary collective of Chartered Accountants, Company Secretaries, and Advocates offering authoritative insights on India’s regulatory and business landscape. With decades of experience in compliance, taxation, and advisory, they empower entrepreneurs and enterprises to make informed decisions.
