Should we report domestic mutual funds holding foreign shares in Schedule FA/FSI

 

Many international funds/ETFs, such as Motilal Oswal S&P 500 Index Fund or Nippon India Taiwan Equity Fund, are domestic mutual funds that invest solely in foreign equity shares. Some other funds, like Parag Parikh Flexi Cap Fund, invest a certain portion of their AUM in foreign equity shares.

The question now is whether an Indian resident (only residents are required to report) who invests in such funds is liable to disclose the investment in Schedule FA and report any income from them in Schedule FSI of the income tax return.

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