APR Filing Guide for Indian Companies with Foreign Subsidiaries

If you are an Indian company with stakes in foreign subsidiaries or joint ventures, filing the Annual Performance Report (APR) is a legal requirement. The Reserve Bank of India (RBI) requires businesses to report the financial performance of their overseas entities on an annual basis.

This guide explains everything you need to know about APR filing in simple, practical language: what it is, why it matters, what documents you need, and how to file it correctly.

What Is APR Filing?

The Annual Performance Report is what APR stands for. Indian companies must file this with the RBI every year for any foreign subsidiary or joint venture in which they own stock.

The report gives the RBI a quick look at the foreign company’s finances, including its income, profit or loss, assets, debts, and ownership information. This helps make sure that overseas investments are being watched after and used for real business reasons.

Who Needs to Turn in APR?

If an Indian company has made an Overseas Direct Investment (ODI) in a foreign company, it must file an APR. This includes:

• Companies that own all of their foreign subsidiaries
• Joint ventures are set up in other countries.
• Companies that have sent money abroad to buy equity
• Limited Liability Partnerships (LLPs) are sometimes used in these situations.

Even if the overseas unit isn’t working or doing anything during the reporting year, you still have to file an APR.

What Information Do You Need to Report?

Get the following facts together before you start your filing:

• Address and name of the foreign entity
• Percentage of equity held by the Indian company
• How much money was put in
• The foreign unit’s income or turnover
• Net gain or loss
• Things you own and things you owe
• Changes in the way shares are owned, if any

There must be applicable documents to back up these details. The numbers that are reported should preferably come from audited financial statements.

What Is the Last Day to File an APR?

The Annual Performance Report must be sent in by December 31 of each year. It must include the financial statistics for the fiscal year that concluded on March 31.

For example, the APR for FY 2024 must be sent in by December 31, 2025.

If you miss this date, you could face compliance problems and fines.

Where and How to File the APR

All APRs must be submitted through the Authorized Dealer (AD) Bank. You’ll need to submit an APR along with an audited financial statement.

The AD bank will review your submission before forwarding it to the RBI.

What Are the Most Common Mistakes to Stay Away From?

Filing an APR looks easy, but businesses routinely make mistakes that cost them money:

1. Not paying attention to dormant subsidiaries

Even if your foreign unit didn’t make any money or do any business throughout the year, you still have to file an APR.

2. Records that aren’t complete

Not keeping proof of payments, shareholding certificates, or ODI permissions might lead to delays or refusals.

Financial Statements of Foreign Entity Must Be Duly Audited

Under the latest RBI Overseas Investment Regulations (2022), the Annual Performance Report (APR) must also attach audited financial statements of the foreign entity whenever the Indian company holds 10% or more equity or has control in that entity. This audit must be conducted by a practicing chartered accountant.

Why APR Compliance Is Important

Following the rules for APR filing gives you more than just legal protection. It also:

• Makes you more likely to be able to make future outbound investments
• Makes it easier for the RBI to approve things faster
• Makes your firm more trustworthy to banks and partners from other countries
• Helps you avoid extra penalties from FEMA

How to Keep Up with APR Filing

Here are some recommendations to make sure you follow the rules on time and without any problems:

Keep a Central Repository

Keep all of your ODI-related papers, including RBI approvals, financials, shareholding certificates, and previous APRs, in a safe and easy-to-reach place.

Set Up Reminders to File

To avoid problems at the last minute, mark December 31 and other compliance dates on your company’s calendar.

Keep an Eye on Changes to RBI Notifications

RBI puts out circulars regularly that could change APR standards. Keep up to date through official channels.

Get Help from a Professional

You need to know about both money and rules to do APR. Hiring a compliance expert or firm can lower your risk and save you time.

What Will Happen If You Don’t Follow the Rules?

Not filing an APR can lead to:

• Fines under the Foreign Exchange Management Act (FEMA)
• Holds on future ODI approvals
• Temporary limits on capital transactions going out.
• More paperwork or checking from the RBI and AD banks

To avoid these problems, make sure your reports are on time, thorough, and correct.

Need Help Filing Your APR? [Schedule a free consultation today.]

If you’re unsure about how to prepare or submit your Annual Performance Report, LedgersCFO is here to help.

We work with Indian companies just like yours to simplify the entire process from collecting the right documents to submitting your APR. Whether it’s your first time or a follow-up filing, our team ensures you stay compliant, accurate, and stress-free.

Book a free consultation today and get expert guidance tailored to your business.

FAQ’s

1. Who is eligible for an APR filing?

Any Indian entity that has made an Overseas Direct Investment (ODI) in a foreign subsidiary or joint venture is eligible and legally required to file an APR. This includes Indian companies, joint ventures, and in some cases even LLPs, depending on the structure of the foreign investment.

2. What is the applicability of APR?

APR applies to all Indian companies that hold equity in a foreign entity through ODI. Even if the foreign unit has remained inactive or non-operational during the reporting year, the APR must still be filed. RBI regulations make this an annual compliance requirement, regardless of business activity.

3. How to file an APR?

The APR must be submitted through the Authorised Dealer (AD) bank along with audited financial statements and shareholding certificates. The AD bank verifies the report and forwards it to the RBI.

4. Who must file the APR with the RBI?

Every Indian entity that has made an overseas investment under the ODI route is required to file an APR with the RBI. This obligation applies whether the foreign subsidiary is operational, dormant, or has generated no income during the financial year. Failing to comply could result in penalties under FEMA and future restrictions on foreign investments.

5. How can LedgersCFO help with APR filing?

LedgersCFO offers complete support throughout the APR filing process. From identifying the correct ODI transactions and collecting financial data to coordinating with your AD bank, we handle everything. Our team stays updated with the latest RBI notifications to ensure your filings are accurate, timely, and fully compliant, so you can focus on your core business with peace of mind.