Do I file Schedule FA if I have moved back to India?
Eventually yes, but usually not in the first year. The disclosure applies to residents in the fuller sense, and a returning Indian normally passes through a transitional residency status first, during which foreign assets and most foreign income stay outside the Indian net. The year that status ends is the year the schedule starts to matter, and it is a date you can work out in advance rather than discover afterwards. Do that work before the first return falls due, because the disclosure is expected to be complete from the very first year in which it applies.
Does Schedule FA apply to an NRI living in Canada?
Not while you are non-resident in India. The schedule is India asking its own residents what they hold outside India, and a non-resident is simply not being asked. What a non-resident does file in India is a return reporting Indian source income, and that is a different exercise altogether, usually a reconciliation of what was deducted at source against what was actually due, with a refund at the end of it. The two get confused because both are Indian filings. The point at which the schedule becomes your problem is the point at which your Indian residence status changes.
Do I report a foreign retirement account in Schedule FA?
A retirement plan left behind with a former employer abroad is an asset held outside India, and it is normally within the scope of the disclosure once you are reporting under it. People miss these because they cannot touch the money and do not yet think of it as theirs. The disclosure obligation and the taxing question are separate: reporting the plan does not by itself decide how growth inside it is treated, which turns on the terms of the plan and on the treaty. Report it, and then deal with the treatment as its own question.
What happens if I left Schedule FA blank by mistake?
Treat it seriously and deal with it early. Undisclosed foreign assets sit under their own dedicated Indian law rather than under the ordinary penalty provisions for an incorrect return, and the consequences there are heavier than for an ordinary omission. That is the reason for not letting it sit unattended. The practical work is to establish what was held in each year, what the correct disclosure would have been, and then to correct on that basis with the evidence assembled first. A correction that is itself incomplete is worse than the original omission.
Does disclosing an asset mean India will tax it?
Disclosure and taxation are two different things, and the schedule is the disclosure. A resident is taxable on worldwide income, so foreign income may well be taxable in India, but that follows from the residence rules rather than from the act of reporting. Equally, an asset that produced nothing at all during the year is still disclosed. Where the foreign country has already taxed the income, relief usually comes through the treaty and a credit, and that has to be claimed and evidenced. Reporting the asset is the start of that conversation, not the end of it.
Which period do I report my foreign balances for?
This is the most common source of error, because the Indian year and the year your foreign statements are drawn to do not coincide. India's own year runs April to March, and the schedule asks for its information over a defined period that has to be matched deliberately rather than assumed. So balances and income taken from a foreign statement usually need recutting before they go on the form. Build the working paper from monthly or transactional data rather than from an annual summary, and the recut becomes straightforward in every year that follows.
Do Canada and the United States share tax information?
Yes, through more than one channel. The treaty has an exchange-of-information article that supports both routine and on-request exchange. Separately, an intergovernmental agreement has Canadian financial institutions identify US-reportable accounts and report them to the CRA, which passes them to the IRS, with the reverse flow for Canadian residents. Most other country pairs use the Common Reporting Standard for the same purpose. See FATCA reporting.
Is moving money between my own accounts in two countries taxable?
Moving your own capital between your own accounts is not itself income, so the transfer is not what creates tax. What can create tax or reporting is the income the money earned before it moved, a foreign-exchange gain on certain holdings, and the reporting obligations the balances themselves trigger — foreign account and asset reports keyed to balances rather than income. Remittances out of some countries also need certification before the bank will send them. See foreign account reporting.
