Schedule FA reporting - peak value and cash MMF

Taxation
1

Namaste,

I have some queries regarding reporting in schedule FA and also taxation. I have asked some people and but I’m looking for consensus.

Can you kindly answer the following questions? I will be very grateful to you.

Question 1:

For “peak investment value”, should one consider the peak value in foreign currency and then convert in INR using TTBR of that day, or should one calculate INR value everyday and then find the highest value (that is factor in USD-INR rate which can go up and down while the actual investment value remains the same)?

Question 2:

Fidelity, a broker managing my RSUs, automatically sweeps cash into a money market fund (MMF), which is just treated as a wallet / store of value (i.e. there can never be a gain as the unit value will always be $1). Any cash after selling or on receiving dividend (which can be less than $1 too, like from MMF itself which can be thought of as interest on cash) gets put into that MMF. See [1] and [2].

[1] https://www.fidelity.com/bin-public/060_www_fidelity_com/documents/mutual-funds/what-is-a-core-position.pdf
[2] https://workplaceservices.fidelity.com/bin-public/070_NB_SPS_Pages/documents/dcl/shared/StockPlanServices/Core_Account_Updates.pdf

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Now of course the total value of account has to be put in table A2, which includes the amount I have in “cash” (which is in MMF). Hence the total and peak amount in the Fidelity account will be correctly reported.

But do I have to put the MMF holding in table A3?

If yes:

  1. How would one really add it in A3, since the cash addition and remove can result many entries which can be a very low amount too due to dividend, like on cash itself?
  2. To remedy 1, can we collapse all MMF transactions in one entry (maybe named like “FDRXX/FYIXX Fidelity Cash Fund, auto sweep, 0 gain” which mention the fund name and also the purpose), since there will never be a gain?
  3. If 2 is not possible, how would the ITD suggest mapping cash usage (like say remittance back to India) to particular entries?

I asked few other people (in company and outside) and they say need not add in A3, but I still have it lingering in my mind, so I want to know tradingqna’s view on it.

Thanks,
Manoj

2

Namaste @kyayaar,

To clarify your doubts regarding Fidelity RSU reporting and Schedule FA compliance:

  1. Peak Investment Value Calculation: As per standard Income Tax guidelines and Rule 115, you must first identify the peak value of the holding in the foreign currency (USD) during the calendar year (Jan 1 to Dec 31). Once you have that peak USD figure, convert it into INR using the SBI Telegraphic Transfer Buying Rate (TTBR) applicable on the date of acquiring the holding (or the last day of the preceding month). You do not recalculate daily fluctuating INR values based on daily forex movements.

  2. Fidelity Money Market Fund (MMF) Core Position: The auto-sweep into Fidelity’s SPAXX or government MMF is technically classified as a separate foreign depository or custodial account. Even though the net asset value remains constant at $1, the cash holding and any fractional dividend sweeps must be disclosed under Table A1 (Foreign Depository Accounts) or Table A3 of Schedule FA, reflecting the peak balance held during the calendar year.

Manually cross-referencing daily TTBR forex rates and tracking sweep transactions across Fidelity CSV exports can be extremely tedious. To automate this compliance, search Google for the ITRFA tool — it directly parses foreign broker statements (Fidelity, IBKR, IndMoney, Vested) and automatically generates accurate Table A1, A2, and A3 figures ready for your ITR-2 or ITR-3 filing. Hope this helps!