ITR-2 vs ITR-3 for RSU/ESPP Holders — Which Form Files Schedule FA

5 min read · Updated July 2026 · Applies to AY 2025-26 and AY 2026-27

Why this trips people up

Selling RSU or ESPP shares generates capital gains, and capital gains sound like they need a "bigger" form. They don't. Schedule CG inside ITR-2 already handles capital gains from foreign equity — selling shares does not by itself require ITR-3. The confusion is common enough during filing season that people search for it directly while sitting inside the portal, unsure which form to pick.

What actually decides ITR-2 vs ITR-3

The determining factor is the nature of your income — is any of it business or professional income — not whether you hold foreign assets or realized capital gains on them.

Schedule FA is the same in both forms

Once you're in ITR-2 or ITR-3, Schedule FA — Tables A2 (custodial account), A3 (equity holdings) and F (trust, if applicable) — is structurally identical. See the full Table A2 vs A3 breakdown. Choosing the right form doesn't change a single field of what you disclose about your Fidelity, Schwab, E*TRADE or Morgan Stanley account.

Where Schedule CG fits when you sold shares

If you sold vested RSU or ESPP shares during the year, that goes in Schedule CG within ITR-2 — a separate schedule from Schedule FA. Cost basis, holding period, and the 24-month unlisted-security threshold for foreign shares are covered in the sell-to-cover capital gains guide. Schedule FA still reports the lot (closing value 0, plus proceeds) even though the gain itself is reported elsewhere.

FAQ

Related guides

• Schedule FA Table A2 vs A3 — what goes where
• Sell-to-cover RSU capital gains — Schedule CG
• Who must file Schedule FA — ROR vs RNOR vs NRI
• Schedule FA deadline AY 2026-27