Missed the July 31 ITR-2 deadline with RSUs? Here's exactly what to do

The July 31 deadline passed. You haven't filed your ITR-2 yet. You hold US RSUs and know you need Schedule FA, Form 44, and all the SBI TTBR conversions — and the whole thing feels complicated enough that it slipped past the deadline.

Here's the short answer: you can still file. The consequences are real but manageable. This article tells you exactly what they are and what to do.

What "belated return" means

A belated return is an ITR filed after the original due date (July 31 for non-audit cases) but before December 31 of the assessment year. It is filed under Section 139(4) of the Income Tax Act.

For AY 2026-27, the belated return window is August 1, 2026 to December 31, 2026.

After December 31, the only option is an Updated Return (ITR-U) under Section 139(8A), which is more expensive (25–50% surcharge on the outstanding tax) and is worth avoiding if at all possible.

What a belated return costs you

Section 234F: the flat late fee

Your total income	Late fee
Above ₹5 lakh	₹5,000
₹5 lakh or below	₹1,000

This is fixed. It doesn't matter whether you file on August 1 or December 30 — the Section 234F fee is the same. It cannot be waived by the CPC or by representation. Add it to your self-assessment tax challan (under "Others" or "Fee u/s 234F") when paying.

Most RSU holders with salaried income and US capital gains will have total income well above ₹5 lakh, so the applicable fee is ₹5,000.

Section 234A: interest on unpaid tax

If you had tax due on July 31 (i.e., TDS and advance tax together didn't cover your full liability), you owe 1% per month interest on the outstanding amount from August 1 until the date of actual payment.

Example: you owed ₹1,20,000 in self-assessment tax on July 31 and file on October 15 — that's 2.5 months at 1%, so ₹3,000 in Section 234A interest.

The interest is computed automatically when you fill the self-assessment tax computation on the ITD portal.

Section 234B: advance tax shortfall

If you didn't pay adequate advance tax during the year (most salaried employees with RSU income are caught here — the employer deducts TDS on salary but RSU capital gains often go unpaid), Section 234B applies at 1% per month on the shortfall from April 1 of the assessment year. The advance tax guide for RSU holders explains how to compute the four installments and avoid Section 234C interest next year.

This runs separately from 234A and compounds quickly if the RSU capital gains were substantial.

What you lose

• Carry-forward of capital losses. A belated return cannot carry forward capital losses to future years. If you sold RSU shares at a loss in FY 2025-26, that loss can offset gains in the same year in the belated return — but it cannot be carried forward to FY 2026-27. This is a real cost if you have significant unrealised gains in future years.
• Certain deductions. Some deductions (Chapter VI-A like 80C, 80D) remain claimable in a belated return. Most standard deductions still apply.

The Schedule FA question: does late filing create Black Money Act risk?

This is the most common fear among RSU holders who missed the deadline. The answer requires separating two things:

Filing Schedule FA late (in a belated return) ≠ non-disclosure.

The Black Money (Undisclosed Foreign Income and Assets) Act, 2015 penalises the concealment or non-disclosure of foreign assets. The penalty under Section 42 of the Act is ₹10 lakh per undisclosed asset. "Undisclosed" means not reported at all — not "reported late."

A belated ITR-2 that includes a complete, accurate Schedule FA is a disclosure. It is late, but it is a disclosure. The risk of a Black Money Act penalty is materially lower than if you file a return with no Schedule FA or don't file at all.

The practical guidance:

1. File the belated return with full Schedule FA as soon as possible
2. Do not omit Schedule FA to simplify the return — that's the actual risk
3. If you previously filed a return without Schedule FA, file a revised return (before July 31) or a belated return (between August 1 and December 31) that includes it

Step-by-step: filing your belated ITR-2 with RSU income

Step 1: Gather your documents

Document	Source	Purpose
Broker statements (Morgan Stanley, Fidelity, E*Trade)	Employer stock plan portal	Vest dates, gross values, sale proceeds
Form 16 (Part A and Part B)	Employer HR/payroll	Salary income, TDS deducted
SBI TTBR rates for all vest and sale dates	SBI website → TTBR historical	INR conversion for Schedule FA, Schedule CG
Form 26AS / AIS	ITD portal → e-File → View AIS	Verify TDS credits and income already captured
1042-S (if dividends received)	Stock plan portal → Tax Documents	Form 44 FTC claim for US withholding on dividends

Step 2: Compute the self-assessment tax

Use the late ITR filing interest calculator to estimate your Section 234F fee, Section 234A interest, and Section 234B interest before you open the ITD portal.

Before filing, calculate the full tax liability:

• Salary income (perquisite at vest + other salary from Form 16)
• Capital gains on RSU sales (Schedule CG: sale proceeds − cost basis, both in INR)
• Dividend income if any (Income from Other Sources)
• Less: TDS already deducted (from Form 26AS)
• Less: FTC credit from Form 44 (US withholding on dividends)
• Add: Section 234F fee (₹5,000)
• Add: Section 234A interest (1% × months late × outstanding tax as of July 31)
• Add: Section 234B interest (if advance tax shortfall)

Pay the self-assessment tax via Challan 280 on the ITD portal (e-Pay Tax) before submitting the return. The BSR code and challan number will be required in the return.

Step 3: File Form 44 first

If you have dividends and a 1042-S, file Form 44 (Foreign Tax Credit claim) on the ITD compliance portal before or simultaneously with the ITR-2. Form 44 filed after the ITR-2 may result in the FTC being disallowed.

Step 4: File the belated ITR-2

Log into the ITD e-filing portal → File Income Tax Return → Assessment Year 2026-27 → ITR-2 → Online.

In the filing type field, select 139(4) — Belated Return. (If you had previously filed a defective or nil return, the option may be 139(5) — Revised Return instead; consult your CA if unsure.)

Complete all schedules:

• Schedule S: Salary income including perquisite
• Schedule CG: Capital gains on RSU sales
• Schedule FA: All foreign assets held during Jan 1–Dec 31, 2025
• Schedule FSI: Foreign-source income (dividends, capital gains)
• Schedule TR: Tax relief (FTC from Form 44)

Step 5: E-verify within 30 days

After submitting, e-verify the return within 30 days using Aadhaar OTP, net banking, or DSC. An unverified return is treated as not filed.

What if you can't file before December 31?

If December 31 passes without filing, the belated return window closes. Your only option becomes the Updated Return (ITR-U) under Section 139(8A):

• Can be filed up to 2 years from the end of the assessment year (i.e., March 31, 2029 for AY 2026-27)
• Requires paying an additional 25% of tax + interest if filed within 12 months of the assessment year end (i.e., by March 31, 2027), or 50% of tax + interest thereafter
• ITR-U cannot be used to claim a refund — only to pay additional tax

The ITR-U surcharge makes it significantly more expensive. A belated return by December 31 is strongly preferable.

The one thing not to do

Don't file a simplified return without Schedule FA to avoid complexity. The Black Money Act exposure from non-disclosure of foreign assets (even through omission, not intent) is far more serious than the Section 234F late fee. File a complete return, even if it takes another few weeks to gather all the TTBR conversions.

Summary: belated return cost for a typical RSU holder

Cost	Amount
Section 234F late fee	₹5,000 (flat)
Section 234A interest (if tax was owed on July 31)	1% × months × outstanding tax
Section 234B interest (if advance tax was short)	1% × months × shortfall
Loss of capital loss carry-forward	Loses carry-forward to future years
Black Money Act risk	Low if Schedule FA is complete and included

File now. Every additional month adds more 234A interest and brings you closer to the December 31 hard stop.