Schedule FSI – Details of Income from outside India and tax relief AY 2026-27
‘Schedule FSI’ in the Income Tax Return (ITR) form is applicable to resident assessees who have earned income from outside India during the financial year. This schedule is used to report such foreign income and claim relief from double taxation under applicable provisions of the Income-tax Act or under a Double Taxation Avoidance Agreement (DTAA).
The schedule requires details such as the country code, Taxpayer Identification Number (TIN) issued by the foreign country, and the head of income under which the foreign income is earned (such as salary, house property, business or profession, capital gains, or other sources.
For each category, the assessee must report the amount of income earned outside India, the tax paid in the foreign country, and the tax payable on such income under the Income Tax Act. The relief available in India is computed as the lower of the tax paid outside India or the tax payable in India on the same income.
Where relief is claimed under 90 or 90A, the assessee must also mention the relevant article of the applicable DTAA.
90, 90A of Income-tax Act, 1961
Rule 128 and Rule 21AB of the Income-tax Rules, 1962
Sections 90 and 90A empower the Central Government to enter into Double Taxation Avoidance Agreements (DTAAs) with foreign countries or specified territories. The purpose of such agreements is to grant relief from double taxation, allocate taxing rights between residence and source countries, prevent tax evasion and avoidance, enable exchange of information, and facilitate tax recovery. India follows both residence-based and source-based taxation, which often leads to double taxation. DTAAs resolve this by either exempting the income in one country or allowing tax credit for taxes paid abroad. Relief under a bilateral treaty is available under Sections 90/90A, while unilateral relief in the absence of a treaty is provided under Section 91.
DTAAs apply only if they are more beneficial than the provisions of the Income-tax Act, though GAAR provisions override this benefit [90(2A)]. To claim relief, a non-resident must obtain a Tax Residency Certificate (TRC) along with furnishing Form 10F, whereas Indian residents require TRC in Form 10FB (application via Form 10FA). Foreign tax credit (FTC) for taxes paid abroad is allowed under Rule 128, subject to filing Form 67 and obtaining necessary certificates. Where DTAA prescribes a specific computation method, it overrides the Act; otherwise, domestic law applies.
This schedule applies to ITR-2, ITR-3, ITR-5, ITR-6 and ITR-7.