Companies and entities incorporated as Limited Liability Partnerships that have received Foreign Direct Investment or made investments in entities abroad are required to file FLA return. FLA stands for Foreign Liabilities and Assets and the return must be filed annually.

Applicability:

Companies and LLPs that either received Foreign Direct Investment and/or made overseas investment in the previous year(s) must file Annual return on Foreign Liabilities and Assets (FLA). Hence, any Company or LLP that has foreign assets or liabilities in the balance sheet must file FLA return.

When:

The FLA returns have to be filed before the 15th July every year.

However, if the accounts are not audited before the due date of submission, then the FLA Return shall be submitted based on unaudited/ provisional accounts and once the accounts are audited, revised FLA Return shall be submitted by 30th September of the same year.

Repercussions:

Non-filing of the return before the due date will be treated as a violation of Foreign Exchange and Management Act, 1999 ("FEMA") and penalty clause for violation of FEMA could be invoked.

Non-Applicability of FLA Return:

A company or an LLP is not required file the FLA returns in the following scenarios:-

1. If a company did not receive FDI or make overseas investment in any of the previous year(s)
2. If a company only received share application money and did not issue shares towards a foreign direct investment outstanding as on 31st March of the reporting year.
3. If a company only remitted share application money and did not receive shares against a overseas direct investment outstanding as on 31st March of the reporting year.
4. If a company had issued shares to a non-resident on a non-repatriable basis and such non resident shareholder(s) has/have transferred their shares to residents during the reporting period, such a transaction is not required to be included in the FLA Return.