Last reviewed: 25 September 2026. Getting FCRA registration is only the start - keeping it means following a strict set of ongoing rules, and breaches can lead to suspension or cancellation. This guide covers the key compliances: the FC-4 annual return, the mandatory SBI account, the 20% administrative-expense cap, the ban on passing funds to other NGOs, and renewal.
Quick summary
The FC-4 annual return
Every FCRA holder files Form FC-4 online with the Ministry of Home Affairs by 31 December, reporting the foreign contributions received and used during the previous financial year, with audited accounts. A nil return is required even in a year with no foreign funds. Late or missed returns are a common reason for FCRA action.
The bank account rules
All foreign contribution must first be received in the designated FCRA account at SBI New Delhi Main Branch. You may keep a separate FCRA utilisation account at your own bank to spend from, but funds cannot enter through any other account.
The 20% administrative-expense cap
An FCRA holder cannot spend more than 20% of the foreign contribution utilised in a year on administrative expenses (salaries of management, office rent and similar), unless it takes the prior approval of the central government. This pushes more of the money towards actual programme work.
Worked example. A Thane education trust utilises Rs 50,00,000 of foreign contribution in FY 2025-26. Its administrative ceiling is 20% of that, or Rs 10,00,000. If management salaries, office rent and audit fees paid from foreign funds come to Rs 12,00,000, the extra Rs 2,00,000 breaches the cap unless prior approval was obtained. The practical fix is to track admin spend monthly against the running utilisation figure, and to meet any overrun from local (non-FCRA) funds before the year closes, because the FC-4 return discloses the split and the breach is visible on its face.
No sub-granting
Since the 2020 amendment, foreign contribution cannot be transferred to any other person or organisation - even one that also holds FCRA registration. A lead NGO can no longer sub-grant foreign funds to partner NGOs; each must receive its own foreign funding.
Renewal and the cost of default
Registration lasts five years. Apply for renewal in Form FC-3C within the six months before expiry (s.16(1)); MHA asks for at least 4 months before expiry. MHA's public notice of 30 September 2025 also makes clear that once the certificate expires, the association cannot receive or utilise foreign contribution until renewal is approved, even if the application is pending. There is no late-renewal route: a lapsed certificate means a fresh application in Form FC-3. Our FC-3C renewal guide sets out the timeline and documents.
Breaches - late FC-4, misuse of funds, using the wrong account, or exceeding the admin cap - can lead to suspension or cancellation of registration and freezing of accounts, so staying compliant is essential.
FCRA compliance calendar
| Compliance | When | Note |
|---|---|---|
| Form FC-4 annual return with audited FCRA accounts | By 31 December for the previous financial year | Nil return even if no foreign funds came in |
| Disclosure of foreign contribution received | Every quarter | Donor-wise details on the association's website or the FCRA portal, as required by Rule 13 of the FCRA Rules, 2011 |
| Changes in name, address, purpose, key functionaries or bank account (Form FC-6 series) | Within the time prescribed in the FCRA Rules | Where 50% or more of the governing body is replaced, MHA's FAQs require intimation within 30 days |
| Admin-cap check | Monthly, and at year-end before FC-4 | 20% of foreign contribution utilised |
| Renewal (Form FC-3C) | Within the six months before expiry; MHA asks for at least 4 months before expiry | No grace period after expiry |
If something has already gone wrong
Several lapses can be compounded under section 41 of the FCRA rather than prosecuted. MHA's FAQs give the compounding amounts where foreign contribution was accepted in breach of the Act (for example, without valid registration or outside the designated account): where the cheque was not deposited, Rs 10,000 or 2% of the amount involved, whichever is higher; where it was deposited but not utilised, Rs 25,000 or 3%; where it was utilised without diversion, Rs 1,00,000 or 5%; and for contribution in kind, Rs 10,000 or 2%. Compounding is at MHA's discretion, so apply promptly once a lapse is found.
Official sources: FCRA Online portal (MHA) · MHA FAQs on FCRA (PDF)
Frequently asked questions
What is the FCRA annual return?
Form FC-4 is the annual return every FCRA holder must file online with the Ministry of Home Affairs, reporting the foreign contributions received and how they were used, along with audited accounts. It is due by 31 December for the previous financial year.
Do I have to file FC-4 even if I received no foreign funds?
Yes. A nil FC-4 return must be filed even in a year with no foreign contribution, as long as your FCRA registration is active.
What is the 20% administrative expenses cap?
Under the 2020 amendment, an FCRA holder cannot spend more than 20% of the foreign contribution utilised in a year on administrative expenses, unless it takes prior approval of the central government.
Can I pass foreign funds to another NGO?
No. Since the 2020 amendment, foreign contribution cannot be transferred or sub-granted to any other person or organisation, even if that other organisation also has FCRA registration.
When do I renew my FCRA registration?
Apply for renewal in Form FC-3C within the six months before expiry (s.16(1)); MHA asks for at least 4 months before expiry. Once the certificate expires, you cannot receive or use foreign funds until renewal is approved, even if the application is pending.
Are donations from NRIs foreign contribution?
It depends on citizenship, not residence. MHA's FAQs say a donation by an Indian citizen living abroad (an NRI) from personal savings through normal banking channels is not foreign contribution. A donation from a person of Indian origin who has taken foreign citizenship, including OCI and PIO card holders, is foreign contribution and must come into the SBI FCRA account. Record the donor's passport nationality for every overseas donation.
What happens if I do not comply?
Non-compliance - late FC-4, misuse of funds, breaching the SBI account or admin-cap rules - can lead to suspension or cancellation of registration and freezing of accounts, so compliance is critical.
We handle your FC-4 return, bank-account compliance, admin-cap monitoring and timely renewal.
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