What is FLA Return (RBI)?
Reviewed by CA Apurav GargLast reviewed
In short
The FLA return (Annual Return on Foreign Liabilities and Assets) is filed with the RBI each year by an Indian company, LLP or other entity that holds foreign direct investment or has invested abroad, giving its foreign liabilities and assets.
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Who files it
The RBI requires the FLA return from every Indian-resident entity that has outstanding foreign direct investment (FDI) or overseas direct investment (ODI) at the end of March. That covers:
- companies and LLPs with foreign shareholders or partners;
- partnership firms, SEBI-registered alternative investment funds and other entities with such investment;
- Indian entities that have set up or invested in a business abroad, such as a foreign subsidiary.
It applies every year the investment remains outstanding, not only the year the money came in. A company that took foreign investment years ago and has received nothing since still files.
What it reports
The return gives the entity's foreign liabilities and assets at the end of March: the foreign investors' equity and the entity's investment abroad, and other cross-border items the form lists, such as loans and trade credit with the foreign investor's group. It is a statistical return that feeds India's balance of payments figures; it does not approve or regularise any investment.
How and when
- It is filed online on the RBI's FLAIR portal (Foreign Liabilities and Assets Information Reporting), after registering the entity on it.
- It is due each year shortly after the financial year ends, by the date the RBI sets. The RBI has extended the date in some years. The Compliance Calendar shows the current date.
- If the accounts are not audited by the due date, the return is filed on unaudited figures and revised after the audit, within the time the RBI allows.
Filing late or not at all
Not filing is a contravention of the foreign exchange rules. It can be regularised by paying a Late Submission Fee within the period the RBI allows; after that, it has to be compounded. A missing FLA return often comes to light when the company next raises foreign money or its bank reviews its FEMA filings.
What goes wrong
- Filing only in the year of investment. The return is due every year the investment is outstanding.
- Valuing foreign equity at the price paid. The return asks for the position at the end of March in the way its instructions set out, not the original price.
- Not revising after audit when the audited figures differ.
Example in rupees
A D2C company received foreign investment three years ago and has had no new foreign money since. On 31 March:
| Item | Position on 31 March |
|---|---|
| Equity held by the foreign fund (at the share of net worth it represents) | ₹3,20,00,000 |
| Amount owed to the fund's group company for shared software | ₹4,00,000 |
The company must still file the FLA return this year, because the foreign investment is outstanding, even though nothing new came in. It reports the foreign equity and the amount owed, and any other items the form asks for, with the year's figures from its accounts, on the RBI's FLAIR portal by the due date. If its audit is not finished by then, it files on unaudited figures and revises the return once the accounts are audited. The figures are illustrative.
Legal reference: Foreign Exchange Management Act, 1999; A.P. (DIR Series) Circular No. 45 dated 15 March 2011; RBI Master Direction – Reporting under FEMA
Related terms
Work it out for your business
Want help applying this to your own accounts?
We handle bookkeeping, GST and TDS for D2C and marketplace sellers, and can walk you through how this works in your business.
General information only, not professional advice. Rules and rates change — check the official source before you act.