Complete Guide to FLA Return Filing for 2024-25: Deadlines, Requirements, and Compliance Procedures.

Introduction: Understanding the Foreign Liabilities and Assets (FLA) Return

The Reserve Bank of India (RBI) has officially launched the Foreign Liabilities and Assets (FLA) reporting round for the financial year 2024-25 on the FLAIR (Foreign Liabilities and Assets Information Reporting) portal as of April 01, 2025. This mandatory annual compliance requirement under the Foreign Exchange Management Act (FEMA) is critical for all entities that have engaged in cross-border investment activities, whether as recipients of Foreign Direct Investment (FDI) or through Overseas Direct Investment (ODI).

The FLA return serves as a comprehensive reporting mechanism that enables the RBI to monitor and track foreign investment flows into and out of India, ensuring transparency and compliance with foreign exchange regulations.

Who Must File the FLA Return? Detailed Eligibility Criteria

The FLA return filing requirement applies to the following entities:

Indian Companies with FDI:
- Companies incorporated in India that have received foreign direct investment in the current financial year or previous years
- Companies with outstanding foreign investment reflected in their balance sheet
- Entities with foreign equity holding (direct or indirect) as of March 31, 2025
Indian Companies with ODI:
- Companies that have made investments abroad in the form of equity, loans, or guarantees
- Companies holding overseas assets in their balance sheet as of the end of FY 2024-25
- Entities with ongoing overseas operations through subsidiaries or joint ventures
Limited Liability Partnerships (LLPs):
- LLPs that have received foreign capital contributions
- LLPs that have made investments in foreign entities
- LLPs with foreign partners or overseas business operations
Other Entities:
- Alternative Investment Funds (AIFs) with foreign investments
- Startups that have raised funds from foreign investors
- Any entity that reports foreign assets or liabilities in their financial statements

Critical Deadlines and Timeline for FLA 2024-25

The FLA reporting process follows a strict timeline that all eligible entities must adhere to:

Portal Launch Date: April 01, 2025
Filing Period: April 01, 2025 to July 15, 2025
Final Submission Deadline: July 15, 2025
Late Submission: Subject to FEMA contravention proceedings and potential penalties

Step-by-Step Guide to Filing the FLA Return on FLAIR Portal

1. Preparation Phase

Before logging into the FLAIR portal, gather the following essential documents and information:

Latest Financial Statements: Balance sheet, profit and loss account for FY 2024-25
Foreign Investment Details: Information on all foreign investments received during the year
Overseas Investment Data: Details of all investments made abroad
Shareholder Information: Complete list of foreign shareholders with their holdings
Asset and Liability Documentation: Details of all foreign assets and liabilities

2. Registration and Access

Visit the official RBI FLAIR portal
For new users: Complete the registration process using your entity’s details
For existing users: Login using your credentials
Verify your dashboard access and ensure that your company information is correctly displayed

3. Form Completion

The FLA form consists of several sections that must be completed with precision:

Section I: General Information and Identification
Section II: Foreign Liabilities
- Details of foreign equity investments received
- Foreign loans and borrowings
- Trade credits and other liabilities
Section III: Foreign Assets
- Overseas equity investments
- Loans extended to foreign entities
- Trade receivables and other assets
Section IV: Financial Performance Indicators
Section V: Attestation and Verification

4. Submission and Verification

Review all entered information for accuracy
Generate a preview of the form for final verification
Submit the completed form through the portal
Save and download the acknowledgment receipt for future reference

Using Provisional Data: Guidance for Interim Filing

If your audited financial statements are not finalized by the July 15, 2025 deadline:

File with Provisional Data:
- Submit the FLA return using provisional or unaudited financial figures
- Indicate in the submission that the data is provisional
- Ensure that the provisional data is as accurate as possible based on available records
Revision Process:
- Once audited statements are available, log in to the FLAIR portal
- Select the “Revise Previous Submission” option
- Update the information with final audited figures
- Submit the revised return with appropriate documentation
Best Practices for Provisional Filing:
- Maintain detailed records of how provisional figures were calculated
- Document any assumptions made during the provisional filing
- Ensure that key management personnel are aware of the provisional nature of the submission

Comprehensive FAQ Section Based on RBI Guidelines

General Questions

Q1: What is the FLA return and why is it important?

A: The FLA (Foreign Liabilities and Assets) return is an annual reporting requirement under FEMA that captures details of all foreign investments received by Indian entities and investments made abroad. It is important for RBI’s statistical analysis of cross-border investments and ensures compliance with foreign exchange regulations.

Q2: Is filing the FLA return mandatory?

A: Yes, filing the FLA return is mandatory for all Indian entities that have received FDI and/or made ODI in the previous year(s) including the current year, and have outstanding FDI and/or ODI in their balance sheet as on the end of the latest financial year.

Q3: What is the reference period for FLA return 2024-25?

A: The reference period is April 1, 2024, to March 31, 2025. The return should reflect the position of foreign liabilities and assets as of March 31, 2025.

Filing Process

Q4: How can I access the FLAIR portal?

A: The FLAIR portal can be accessed through the RBI website. New users need to register, while existing users can log in using their credentials.

Q5: Can I save a partially completed form and return later?

A: Yes, the FLAIR portal allows users to save partially completed forms as drafts. You can return later to complete and submit the form before the deadline.

Q6: Is digital signature required for FLA submission?

A: Yes, the FLA return must be digitally signed by an authorized signatory of the reporting entity using a valid Digital Signature Certificate (DSC) before final submission.

Technical Questions

Q7: What should I do if I encounter technical issues while filing?

A: If you face technical difficulties, first clear your browser cache and try again. If the issue persists, take a screenshot of the error message and contact RBI at surveyfla@rbi.org.in for assistance.

Q8: Can the FLA return be submitted in physical form?

A: No, the FLA return must be submitted only through the online FLAIR portal. Physical submissions are not accepted.

Q9: How do I know if my submission was successful?

A: Upon successful submission, the FLAIR portal generates an acknowledgment receipt with a unique submission ID. This should be downloaded and retained for future reference.

Data and Reporting

Q10: How should investments in multiple foreign currencies be reported?

A: All foreign currency values should be converted to USD using the RBI reference rate as of March 31, 2025, and then reported in the FLA return.

Q11: How do I report indirect foreign investment?

A: Indirect foreign investment (where a foreign entity invests through an Indian company) should be reported by identifying the ultimate beneficial owner and providing details in the appropriate section of the FLA form.

Q12: How should listed securities be valued?

A: Listed equity securities should be valued at market price as of March 31, 2025. Unlisted securities should be valued based on the latest available financial statements of the investee company.

Compliance and Penalties

Q13: What are the consequences of not filing the FLA return?

A: Non-compliance can result in proceedings under FEMA, which may include monetary penalties up to three times the sum involved, restrictions on further foreign investment activities, and regulatory scrutiny.

Q14: Can I request an extension for filing the FLA return?

A: The RBI typically does not grant extensions for filing the FLA return. In exceptional circumstances, a written request with substantial justification may be considered, but approval is at RBI’s discretion.

Q15: If my company has no changes in foreign liabilities and assets compared to the previous year, do I still need to file?

A: Yes, filing is mandatory even if there are no changes. In such cases, you should file the return with the same details as the previous year, confirming that no changes have occurred.

Common Challenges and Solutions in FLA Filing

Challenge 1: Complex Corporate Structures

Solution: Map your entire corporate structure before filing, identifying all direct and indirect foreign investments. Consider consulting with a FEMA specialist for complex group structures.

Challenge 2: Valuation of Unlisted Securities

Solution: Follow the RBI guidelines for valuation, which typically require using the book value based on the latest financial statements of the investee company.

Challenge 3: Reporting Multiple Rounds of Investment

Solution: Maintain detailed records of each investment round, including dates, amounts, and changes in shareholding patterns, to ensure accurate reporting.

Legal Framework and Regulatory Background

The FLA return filing requirement is established under the Foreign Exchange Management Act, 1999 (FEMA), which governs all foreign exchange transactions in India. Specific provisions include:

FEMA Notification No. FEMA 395/2019-RB dated October 17, 2019: Establishes the framework for reporting of foreign investments
RBI Master Direction on Reporting under FEMA: Provides detailed guidelines on various reporting requirements
Circular dated March 28, 2019: Introduced the web-based FLAIR portal for electronic submission of FLA returns

Industry-Specific Considerations

Technology and Startup Sector

Startups with foreign funding need to pay special attention to convertible instruments, SAFEs (Simple Agreement for Future Equity), and option pools while reporting foreign liabilities.

Manufacturing Sector

Manufacturing companies should carefully report foreign technology collaborations, equipment financing arrangements, and supplier credits from foreign entities.

Service Sector

Service companies with overseas clients should distinguish between regular trade receivables and other forms of foreign assets to ensure accurate reporting.

Resources and Support

Official Guidance Materials

Comprehensive User Manual: Available for download on the FLAIR portal
Video Tutorials: Step-by-step guides for navigating the filing process
Sample Forms: Templates and examples of correctly completed FLA returns
RBI Circulars and Notifications: Official communications regarding FLA filing requirements

Help and Support Channels

For technical assistance or clarification on filing requirements, contact:

Email Support: surveyfla@rbi.org.in
Telephone Helpdesk: Available during business hours (contact details provided on the FLAIR portal)
FAQ Section: Regularly updated on the FLAIR portal

Conclusion: Ensuring Compliance While Minimizing Regulatory Risk

Timely and accurate filing of the FLA return is not just a regulatory requirement but a strategic imperative for all entities engaged in cross-border investments. By adhering to the July 15, 2025 deadline and ensuring complete and precise reporting of all foreign liabilities and assets, businesses can:

Maintain good standing with regulatory authorities
Avoid punitive measures under FEMA
Establish a track record of compliance that facilitates future foreign investment transactions
Contribute to accurate national statistics on foreign investment flows

Even if audited financial statements are not yet available by the deadline, filing with provisional data demonstrates good faith compliance and can be updated later when final figures are available. The key is to ensure transparent and timely communication with the RBI through proper utilization of