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Everything You Need To Know About FLA (Foreign Liabilities And Assets) Reporting


The Annual return on foreign liabilities and assets (FLA) needs to be submitted by all the entities which have received FDI or made an investment overseas in current and previous year(s).


1. What Is FLA Annual Return?

FLA annual return is one of the compliances that have to be met by the companies/LLP’s that are involved with FDI (Foreign Direct Investments) or companies who invest in foreign countries either via joint venture or wholly-owned subsidiaries, also termed as Overseas Direct Investment (ODI).

FLA Annual Return must be directly submitted by the entities to Reserve Bank of India. FLA Annual return should cover all foreign

2. Who Needs To File FLA Annual Return?

Annual return on Foreign Liabilities and Assets has been notified under FEMA 1999 and it is required to be submitted by all the India resident companies which have received FDI and/ or made overseas investment in current and any of the previous year(s)

All the foreign Assets and Liabilities must be notified by the company to RBI.  In the where a company does not have any foreign assets and liabilities in the current year but has outstanding FDI or ODI from the previous year(s), they must file FLA Annual returns.

3. How And When To File FLA Annual Returns?

The prescribed method of filing for the FLA Annual return is via FLAIR System (Foreign Liabilities and Assets Information Reporting System). It is required to file by the companies that fall under the above-mentioned criteria. The Filing of FLA Annual return is to be done every year on or before the 15th of July.

It must Register on the Flair portal to file FLA annual returns the user registration requires two things.

  1. SCANNED (as PDF/JPG) and SIGNED authority letter and
  2. Verification letter (SAVED ASPDF(NOT SCANNED), NOT SIGNED)

The members of the company authorized to file the FLA return are Company Secretary, Chief Financial Officer, and Directors.

If the company’s accounts are not audited before the due date of submission. Then the FLA Return should be submitted based on an unaudited (provisional) account. Once the accounts get audited and there are revisions from the provisional information submitted by the company, they are supposed to submit the revised FLA return based on audited accounts by the end – September.

Please Note: Indian entities that do not comply with the said requirement will be treated as non-compliant with FEMA.

4. What Happens If Companies Do Not File FLA Returns?

  • In case the company does not file the FLA return within the given time, the company will be liable to pay a penalty of thrice the sum involved in the contravention. In case it is not quantifiable, then a penalty of Rs 2, 00,000 will have to be paid by the company. If the contravention is continuing, a penalty of Rs 5,000 per day will have to be paid by the company.
  • The regional offices of RBI have the power to compound contraventions without any limit.

5. Which Companies Are Exempted From Filing FLA RETURN?

  • Companies that do not have any outstanding balance of FDI or ODI by the end of the financial year are exempt from filing FLA return.
  • Companies that have only issued shares on a non-repatriable basis to the non-residents of India are exempt from filing FLA return.
  • Companies that have only received share application money and have not received any FDI or not made any ODI, are exempt from filing FLA return.

If you need more information or help with the Filings reach out to us at Wazzeer or