How is TCS applied on LRS remittances for foreign stocks?

For FY 2025-26, there is no TCS on aggregate LRS remittances up to ₹7 lakh per financial year (PAN-based across all banks). Above ₹7 lakh, TCS applies at 20% on the excess. TCS is an advance tax credit, not a permanent cost — you reclaim it when filing your ITR.

Do foreign stocks get the 12.5% equity LTCG with ₹1.25 lakh exemption?

No. Foreign stocks fall outside Section 112A, so the ₹1.25 lakh annual exemption does not apply. Long-term gains (holding over 24 months, sold on or after July 23, 2024) are taxed at a flat 12.5% without indexation. Short-term gains (held 24 months or less) are added to income and taxed at your slab rate.

Conceptual · Article 1.2.3.1

Foreign Listed Stocks.

Q: Can I buy US stocks like Apple or Tesla directly using LRS?

Yes. Under LRS, resident Indians can remit up to USD 250,000 per financial year and buy shares on foreign exchanges, including US stocks. You need an overseas brokerage account and must initiate the transfer through your Indian bank using purpose code S0011. Gains are taxed in India at your slab rate if sold within 24 months, or a flat 12.5% if held over 24 months and sold on or after July 23, 2024.

Q: Is filing Schedule FA mandatory for foreign stocks?

Yes. Every Resident and Ordinarily Resident must declare all foreign assets in Schedule FA of ITR-2 or ITR-3, even with no profit or below-threshold income. Reporting follows the calendar year (value as of December 31). Non-disclosure can attract a penalty up to ₹10 lakh per year under the Black Money Act, 2015.

Q: Is the USD 250,000 LRS limit per person or per family?

Per individual, per financial year. Each resident Indian has their own USD 250,000 limit, tracked via PAN across all banks. Limits cannot be pooled or transferred between family members, and remittances must come from each person's own legitimately owned funds.

Own Apple Directly. USD 250,000 a Year. The LRS Route.

Published as on 29 June 2026

A foreign listed stock is a share of a company that trades on an exchange outside India — Apple, Microsoft, Amazon on US markets. RBI's Liberalised Remittance Scheme (LRS) lets every resident Indian send up to USD 250,000 per financial year abroad to buy these shares directly, with no Indian fund in between. You become the actual owner. But the structure carries layers most investors underestimate: 20% TCS above ₹7 lakh of remittances, a 24-month long-term holding period (not 12), a flat 12.5% LTCG with NO ₹1.25L equity exemption, and mandatory Schedule FA disclosure under the Black Money Act. A satellite holding — 5-10% of equity — not the core.

USD 250K

LRS Limit / Year

20%

TCS Above ₹7L

24 months

For LTCG (not 12)

12.5%

LTCG (No Exemption)

Executive Summary · Page 2

Executive Summary · 6 Findings

Direct foreign stock ownership via LRS answers a specific question: how do I own a global company that simply doesn't exist on Indian exchanges? Introduced by RBI in February 2004, LRS is the primary legal route for residents to invest directly in global equities — up to USD 250,000 per individual, per financial year. The opportunity is real. So is the compliance burden. Foreign stocks are NOT Indian equity for tax purposes.

Covers the four-step LRS mechanics (purpose code S0011, Form A2), 20% TCS above the ₹7 lakh threshold, the three-layer return engine (company, market, currency), why direct stocks beat global mutual funds on tax but lose on simplicity, the critical Section 112 tax treatment (24-month LTCG at 12.5%, no exemption), Schedule FA disclosure, dividend FTC via Form 67/W-8BEN, and the satellite role.

Key Findings

USD 250,000 per person, per year — you own the shares directly.

LRS lets each resident Indian remit up to USD 250,000 per financial year (April-March) to buy shares on the NYSE, NASDAQ and other foreign exchanges. The cap is per individual, tracked via PAN across all banks. The shares sit in your own overseas brokerage account — no Indian fund layer. Purpose code S0011 (Portfolio Investment) via Form A2.

20% TCS above ₹7 lakh — a real cash-flow hit, not a permanent tax.

No TCS on aggregate LRS remittances up to ₹7 lakh/year (PAN-based, all banks, all purposes combined). Above ₹7 lakh: 20% TCS on the excess. Remit ₹12L → TCS of ₹1L (20% of ₹5L). Fully reclaimable as a credit at ITR filing — but you must fund it upfront, separate from your investment capital.

Three return layers: company, market, currency.

Rupee returns depend on stock performance, the foreign market environment, AND the INR/USD move. Buy at ₹80/USD, sell at ₹85 → currency adds to returns even if the stock is flat. The rupee has historically depreciated ~3-4%/yr vs USD — a tailwind, not a guarantee. Currency can move against you too.

NOT Indian equity for tax — Section 112, not 112A.

Foreign stocks fall outside Section 112A: NO ₹1.25L annual exemption, and the long-term threshold is 24 months, not 12. Sell within 24 months → STCG added to income at slab rate (up to 30% + surcharge + cess). Hold over 24 months and sell on/after July 23, 2024 → flat 12.5% LTCG, no indexation. The 24-month rule catches many investors off guard.

Schedule FA disclosure is non-negotiable.

Every Resident and Ordinarily Resident must declare foreign assets in Schedule FA (ITR-2/ITR-3) — even with zero profit or below-threshold income. Reporting follows the CALENDAR year (value as of Dec 31), not the financial year. Non-disclosure: up to ₹10 lakh penalty per year under the Black Money Act, 2015, plus prosecution risk. India receives data via CRS and FATCA.

A satellite, not the core — 5-10% of equity.

Direct LRS investing suits researched conviction in a company not available in India, a 5+ year horizon, and capacity to handle research, monitoring, tax filing and compliance. Geographic diversification is real but limited — Indian IT and US tech often move together. For most, build a core Indian portfolio first. International funds offer global exposure with simpler compliance.

At A Glance

Metric	Value	Detail
LRS Limit	USD 250,000/yr	Per individual, PAN
Purpose Code	S0011	Portfolio Investment
TCS	20%	Above ₹7L/yr
LTCG Holding	>24 months	Not 12 months
STCG (≤24 mo)	Slab rate	Up to 30%+
LTCG (>24 mo)	12.5%	No exemption, no indexation
US Dividend WHT	25%	DTAA, FTC via Form 67
Allocation	5-10% of equity	Satellite

Exhibit 01: Foreign Stocks vs Indian Equity Tax

Feature	Foreign Stock	Indian Equity
LTCG holding	24 months	12 months
₹1.25L exemption	None	Applies
LTCG rate	12.5%	12.5%
STCG	Slab rate	20%
Section	112	112A

Same 12.5% LTCG headline rate, but foreign stocks lose the ₹1.25L exemption and demand a 24-month hold. Short-term gains are taxed far harder — at slab (up to 30%) versus a flat 20% for Indian equity. Add currency risk and Schedule FA filing. Treat as satellite.

The Opening · Page 3

The Opening

A foreign listed stock is simply a share of a company that trades on an exchange outside India — Apple, Microsoft or Amazon on US markets. When you buy directly by remitting money abroad under LRS, you become the actual owner, just like any international investor. This differs from an Indian mutual fund that invests in global companies: there, a fund manager owns the shares and you own units. With direct LRS investing, there is no Indian fund layer — the shares sit in your own overseas brokerage account.

"Geographic diversification does not eliminate risk. It changes where the risk comes from. Foreign stock returns have three moving parts working at once — the company, the foreign market, and the rupee. Access to foreign markets does not equal diversification. Design determines diversification."
The Satellite-Not-Core Frame

The mechanics. Up to USD 250,000 per resident per financial year, remitted via Form A2 through an Authorised Dealer bank under purpose code S0011. The ₹7 lakh TCS threshold is PAN-based and cumulative across all banks and all LRS purposes; above it, 20% TCS applies (reclaimable at ITR). Currency conversion typically costs a 1-2% spread. The INR has historically depreciated ~3-4%/yr vs the USD — historically a tailwind for Indian holders of US assets, but not a law of nature.

FY 2025-26 context. Tax is the defining difference. Foreign stocks fall under Section 112, not 112A: a 24-month long-term holding period, a flat 12.5% LTCG (sold on/after July 23, 2024), and NO ₹1.25L exemption. Short-term gains (≤24 months) are taxed at slab. Schedule FA disclosure follows the calendar year and is mandatory regardless of profit. This is a satellite holding — 5-10% of equity — not the core.

The Honest Boundary: Direct foreign stocks are NOT a free diversification lunch — Indian IT and US tech often fall together. They are NOT tax-light: short-term gains hit slab rates and there is no ₹1.25L exemption. They are NOT low-admin: Schedule FA, Form 67 and W-8BEN are your responsibility, with ₹10 lakh-per-year penalties for non-disclosure. They ARE the only way to directly own specific global companies unavailable in India — for investors with conviction, a 5+ year horizon, and the discipline to comply.

Structure

Part I

How LRS Works, the Four Steps, TCS & Access Routes

Part II

Tax (Section 112), Dividends, vs Global Mutual Fund

Part III

5 Mistakes, Currency & Diversification Reality, Schedule FA

Part IV

The Verdict: A Satellite for Conviction, Not the Core

Use If

✓ Researched conviction in a non-Indian name

✓ 5+ year horizon

✓ Comfortable with equity + currency risk

✓ Will file Schedule FA & Form 67

Do NOT Use If

✕ No core Indian portfolio yet

✕ Compliance feels burdensome

✕ Expecting guaranteed currency gains

✕ Calling 1-2 names "diversification"

Part I

How LRS Works, the Four Steps, TCS, and Access Routes

The RBI Liberalised Remittance Scheme mechanics — purpose code S0011 and Form A2, the USD 250,000 per-individual cap tracked by PAN, the ₹7 lakh TCS threshold with 20% on the excess, and how to access foreign markets through Indian brokers' international platforms or foreign brokers.

Part I · Page 4

The Four Steps

Open an overseas brokerage account

Indian-origin and global platforms let residents open foreign brokerage accounts. You need your PAN card and standard KYC documents. Access is via Indian brokers' international platforms or directly through foreign brokers.

Initiate the remittance

Ask your bank to send money abroad under LRS. Fill Form A2, declare the purpose, submit KYC. The transfer routes through an Authorised Dealer (AD) bank. Retail equity purchases use RBI purpose code S0011 (Portfolio Investment by individuals).

Stay within the LRS limit

Up to USD 250,000 per financial year (April-March), applied across all banks combined and tracked by PAN. Per individual — a family of four, each earning independently, could each remit up to USD 250,000 from their own funds.

Buy the shares

Once funds arrive in your overseas account, buy shares of your chosen companies through the foreign broker. Factor in brokerage and a currency conversion spread of typically 1-2%.

LRS Quick Facts

Item	Detail
Introduced	RBI, February 2004
Limit	USD 250,000 / financial year
Basis	Per individual, tracked by PAN
Form	Form A2 via AD bank
Purpose Code	S0011 (Portfolio Investment)

TCS — Tax Collected at Source

20% Above ₹7 Lakh (FY 2025-26)

No TCS on aggregate LRS remittances up to ₹7 lakh/year (PAN-based, across all banks and all "any other purpose" remittances including equity). Above ₹7 lakh: 20% TCS on the excess.

TCS is an advance tax collection, not an extra tax — fully adjusted against your final tax liability at ITR filing.

Worked Example — Priya, Bengaluru

Item	Amount
Remittance (FY)	₹12,00,000
TCS-free threshold	₹7,00,000
Amount above ₹7L	₹5,00,000
TCS @ 20%	₹1,00,000
Recovered at ITR	₹1,00,000 (credit)

Three Things to Know About TCS

✓ Advance credit, not permanent — fully adjusted at ITR.

✓ Track across all banks — ₹7L threshold is PAN-based and cumulative (travel, education, investment all count).

✓ Time large remittances — splitting across two financial years can reduce the TCS outflow if it suits your plan.

Cards Are NOT a Route

International credit/debit cards work for current-account transactions (travel, shopping) only. Investing in foreign securities is a capital-account transaction and must route through a formal LRS remittance via an AD bank. Using a card to buy stocks is a FEMA violation.

The access insight: the route is legal and well-trodden, but the friction is real — KYC, Form A2, the S0011 code, currency spreads, and TCS cash-flow planning. The "easy part" is buying the stock. The hard part is the wrapper around it. Plan the remittance amount and timing before you fund the trade.

Part II

Tax (Section 112), Dividends, and vs Global Mutual Fund

Why foreign stocks fall under Section 112 — not the equity-friendly 112A — with a 24-month long-term threshold, a flat 12.5% LTCG and NO ₹1.25L exemption; how foreign dividends are taxed and credited via Form 67 and W-8BEN; and where direct stocks beat global mutual funds on tax but lose on simplicity.

Part II · Page 6

Tax on Gains — Section 112

Foreign Stocks Are NOT Indian Equity

Foreign stocks bought via LRS fall outside Section 112A — the section giving favourable treatment to Indian listed equity and equity mutual funds. They fall under Section 112. So: NO ₹1.25 lakh annual exemption, and the long-term threshold is 24 months, not 12.

STCG: ≤24 Months → Slab Rate

Sell within 24 months of buying and the entire gain is added to your income and taxed at your slab rate — up to 30% (plus applicable surcharge and health & education cess) for higher-income individuals.

LTCG: >24 Months → Flat 12.5%

Hold for more than 24 months → flat 12.5% (no indexation), for shares sold on or after July 23, 2024. No ₹1.25L exemption applies.

Meera, Mumbai: bought USD 5,000 of US shares June 2022, sold September 2024 at USD 7,000 — gain ~₹1,68,000. Held >24 months → 12.5% → ~₹21,000 tax. Had she sold in July 2024 (just under the window), the same gain would be taxed at her 30% slab → ~₹50,400, more than double.

The 24-Month Trap

Unlike Indian listed equity, where "long-term" is just 12 months, foreign stocks require a 24-month hold to qualify as long-term. This single difference catches many investors off guard and leads to an unexpectedly large tax bill. Gains are computed in rupees using applicable forex conversion.

Tax on Dividends

Foreign dividends are taxed as "Income from Other Sources" at your slab rate. For US stocks, under the India-US DTAA (Article 10), withholding on dividends to Indian residents is capped at 25%. File Form W-8BEN with your broker (Certificate of Foreign Status) so the treaty rate applies — usually requested at account opening.

Foreign Tax Credit — Form 67

The 25% US withholding is credit-eligible in India. Offset it against your Indian tax liability by filing Form 67 before your ITR due date. Miss the Form 67 deadline and you lose the credit — meaningful if you hold dividend payers.

Direct Stocks vs Indian Global Mutual Fund

What Changes	Direct (LRS)	Global MF
Who owns shares	You directly	Fund manager
Holdings	Your choice	Built-in basket
Research	Yours	Manager's
LTCG tax	12.5% (>24 mo)	Slab rate
Filing	Schedule FA	Simpler
Min invest	Broker-set	~₹500 SIP

The tax difference matters more than most realise: because most Indian global mutual funds hold under 65% in Indian domestic equity, they do NOT qualify for equity fund treatment — their gains, short and long, are taxed at slab. Direct foreign stocks held >24 months are taxed at a flat 12.5% regardless of your bracket. For 30%-bracket investors, that gap is significant. But the MF handles Schedule FA and foreign-income reporting internally; you only see a fund unit. Neither route is universally better — it depends on time, conviction, and tolerance for compliance.

Part III

Five Mistakes, the Diversification Reality, and Schedule FA

The five expensive mistakes Indian investors make with LRS investing, why "access to foreign markets" is not the same as diversification, the three layers of diversification direct investing does and does not solve, and the calendar-year Schedule FA disclosure rule under the Black Money Act.

Part III · Page 8

Five Common Mistakes

Treating currency as guaranteed profit

The rupee has historically weakened vs the dollar, adding to returns — but it's a pattern, not a guarantee. Currency can move against you and cut returns even when the stock does well.

Ignoring the 24-month holding period

Confusing it with the 12-month rule for Indian stocks. Selling a foreign stock at 20 months means STCG at full slab rates — a costly, avoidable surprise.

Not filing Schedule FA

The most dangerous mistake. India receives foreign-holding data via CRS and FATCA. Non-disclosure is hard to conceal and disproportionately costly — the penalty can exceed a small investment many times over.

Calling 1-2 global names "diversification"

Owning Apple and one Indian tech stock is concentration in a different geography. True diversification needs different asset types, sectors and geographies in meaningful proportions.

Not planning for TCS cash flow

Remit ₹12L in one go → expect ₹1L TCS deducted upfront (20% on ₹5L above ₹7L). You recover it at ITR, but you need that cash available separately. Plan amount and timing.

Currency: A Worked Illustration

Rahul, Hyderabad — Same Stock, Two Currency Paths

Invested ₹8L (~USD 10,000) in a US tech stock Jan 2022 at ₹80/USD. Stock rose 30% to USD 13,000 over two years.

Rupee weakens to ₹84: worth ₹10,92,000 → +36.5% in rupee terms.
Rupee strengthens to ₹76: only ~+23.5% — same 30% stock gain.

Does Going Abroad = Diversification?

Layer	Solved by Direct LRS?
Asset class (equity/debt/gold)	No — still equity
Geography (India vs global)	Yes, if spread across markets
Company concentration	Only if you buy a basket

Geographic diversification is real but limited: 5-10% in US/European stocks reduces dependence on India's cycle. But sector correlation persists — Indian IT and US tech often move together. Access to foreign markets does not equal diversification. Design determines diversification.

Schedule FA — Non-Negotiable

Calendar Year, Not Financial Year

Every Resident and Ordinarily Resident must declare foreign assets in Schedule FA — even with no profit or below-threshold income. Reporting follows the calendar year: for ITR of FY 2025-26, report holdings as of December 31, 2025 (not March 31, 2026). File in ITR-2 or ITR-3; values in INR at SBI's TT Buying Rate. ITR-1/ITR-4 do not include Schedule FA — using them is non-compliant.

Item	Detail
Penalty (non-disclosure)	Up to ₹10L / year
Law	Black Money Act, 2015
Data sources	CRS & FATCA
Small-investor relief	<₹20L aggregate (penalty only)

The compliance truth: from October 1, 2024, if your aggregate foreign movable assets stay under ₹20 lakh at any point in the calendar year, the ₹10 lakh penalty (Sections 42-43) does not apply — but the disclosure obligation still stands. The relief protects against the penalty, not the duty to report. Best practice and strong legal advice: always disclose, no matter how small.

Part IV

The Verdict

A satellite for conviction. Not the core.

Part IV: The Verdict · Page 10

30-Second Summary

Direct foreign stock investing via LRS is the only way to truly own a specific global company unavailable in India. Each resident can remit up to USD 250,000 per financial year (purpose code S0011, Form A2). Above ₹7 lakh of aggregate remittances, 20% TCS applies — reclaimable at ITR but a real cash-flow item. Returns ride three layers: company, foreign market, and currency. The rupee's historical ~3-4%/yr depreciation has helped, but is not guaranteed.

The defining feature is tax. Foreign stocks fall under Section 112, not 112A: a 24-month long-term threshold, a flat 12.5% LTCG (sold on/after July 23, 2024), and NO ₹1.25L exemption. Short-term gains (≤24 months) hit slab rates up to 30%. Schedule FA disclosure follows the calendar year and is mandatory regardless of profit, with ₹10 lakh-per-year penalties for non-disclosure under the Black Money Act. Use as a satellite — 5-10% of equity — after a core Indian portfolio is built.

"Geographic diversification does not eliminate risk — it changes where the risk comes from. The opportunity to own Apple or Microsoft directly is real, but access to foreign markets is not the same as diversification, and a 12.5% headline LTCG rate is not the same as Indian-equity tax treatment. Design determines diversification. Compliance determines whether the gains are yours to keep."
The Final Orientation

The Bottom Line: Use direct foreign stocks via LRS for researched conviction in a company not available in India, with a 5+ year horizon, comfort with equity plus currency risk, and the discipline (or professional support) to file Schedule FA and Form 67 correctly. Treat it as a 5-10% satellite, not the core — build your Indian portfolio first. Remember the three traps: the 24-month LTCG threshold, the missing ₹1.25L exemption, and the calendar-year Schedule FA rule. If compliance feels burdensome, an Indian international/feeder fund delivers global exposure with simpler filing, at the cost of some tax efficiency and control.

ADWIZR · June 2026

Decision Rules

Use Correctly As

✓ 5-10% satellite of equity

✓ 5+ year horizon

✓ Researched conviction

✓ Schedule FA & Form 67 filed

Misuse Destroys Value

✕ Core of equity allocation

✕ Selling before 24 months

✕ Skipping Schedule FA

✕ Betting on the rupee

Before You Remit — Checklist

Four Things to Confirm

(1) TCS cash flow — budget 20% on remittances above ₹7L, recovered later. (2) W-8BEN on file — so the 25% US dividend treaty rate applies. (3) 24-month clock — plan holding period for LTCG. (4) Schedule FA + Form 67 — engage a tax professional who understands international investing.

USD 250K

Per year

LRS limit, per person

24 mo

For 12.5% LTCG

No ₹1.25L exemption

5-10%

Of equity

Satellite allocation

Investor FAQ

Questions Indian Investors Ask

Seven questions, answered directly.

Investor FAQ · Page 12

Frequently Asked Questions

Q1 Can I buy US stocks like Apple or Tesla directly using LRS?

Yes. Under LRS, resident Indians can remit up to USD 250,000 per financial year and buy shares on foreign exchanges, including US stocks. You need an overseas brokerage account and must initiate the transfer through your Indian bank using purpose code S0011. Gains are taxed in India: at your slab rate if sold within 24 months, or a flat 12.5% if held over 24 months and sold on or after July 23, 2024.

Q2 Do I pay tax twice — abroad and in India?

For capital gains, most countries (including the US) do not tax non-resident individuals, so double taxation typically does not arise on gains. For US dividends, the US withholds 25% at source for Indian residents. Claim this as a credit against your Indian tax by filing Form 67. Filing Form W-8BEN with your US broker ensures the correct treaty rate applies. Miss the Form 67 deadline and you lose the credit.

Q3 Is the USD 250,000 LRS limit per person or per family?

Per individual, per financial year. Each resident Indian — including minors, with a guardian signing — has their own USD 250,000 limit. Limits cannot be pooled or transferred between family members. Each person's remittances must come from their own legitimately earned or owned funds, tracked via PAN across all banks.

Q4 What happens to my foreign stocks if I become an NRI?

Once your residential status changes to NRI under FEMA, you can no longer use LRS for new investments, but you can continue to hold shares already bought. Your income-tax residential status and your FEMA residential status are calculated differently — changing jobs abroad does not automatically change both at once. Consult a tax adviser before and after any status change to understand obligations under both frameworks.

Q5 Is there a minimum amount to start?

No regulatory minimum under LRS, though your overseas broker may set one. Since TCS applies only above ₹7 lakh of total annual LRS remittances, smaller amounts (say ₹2-5 lakh) can be remitted without TCS impact. But factor in brokerage, currency conversion charges (typically a 1-2% spread), and the complexity of Schedule FA filing — all of which exist regardless of investment size.

Q6 Can I use a credit or debit card instead of LRS?

No. International credit and debit cards work for current-account transactions such as travel and shopping, but investing in foreign securities is a capital-account transaction and must route through a formal LRS remittance via an Authorised Dealer bank. Using a card to buy investments would be a FEMA violation.

Q7 If I lose money on foreign stocks, can I use the loss?

Yes, within limits. Capital losses on foreign stocks can be set off against capital gains from other assets in India. Short-term losses offset both short- and long-term gains; long-term losses offset only long-term gains. Unused losses can be carried forward up to eight assessment years — but only if you file your ITR on time. Missing the ITR deadline forfeits the right to carry forward those losses.

Key Terms & Definitions

LRS (Liberalised Remittance Scheme)

RBI scheme introduced in February 2004 allowing every resident Indian individual to remit up to USD 250,000 per financial year abroad for permitted current and capital account transactions, including the direct purchase of foreign listed shares. Tracked per individual via PAN across all banks.

Purpose Code S0011

The RBI purpose code used for retail equity purchases under LRS — covering purchase of equity shares under Portfolio Investment by individuals. Declared on Form A2 when initiating the remittance through an Authorised Dealer (AD) bank.

TCS (Tax Collected at Source)

An advance tax the bank collects on LRS remittances and deposits with the government. For FY 2025-26: nil up to ₹7 lakh aggregate per year, then 20% on the excess. Not a permanent cost — fully adjusted against your final tax liability at ITR filing.

Section 112 vs 112A

Indian listed equity and equity mutual funds enjoy Section 112A (12-month LTCG, ₹1.25L exemption). Foreign stocks fall under Section 112: a 24-month long-term threshold, flat 12.5% LTCG without indexation, and NO ₹1.25L exemption. Short-term gains are taxed at slab rate.

Schedule FA

The schedule in ITR-2/ITR-3 where Residents and Ordinarily Resident must declare all foreign assets, reported on a calendar-year basis (value as of December 31). Mandatory regardless of profit. Non-disclosure can attract up to ₹10 lakh penalty per year under the Black Money Act, 2015.

Form W-8BEN & Form 67

W-8BEN certifies your non-US status to your broker so the 25% DTAA treaty rate on US dividends applies. Form 67, filed with the Indian tax department before the ITR due date, claims the Foreign Tax Credit for tax withheld abroad. Missing the Form 67 deadline forfeits the credit.