Rule 115 and the SBI TT buying rate, explained
July 2026 · 7 min read
Every rupee figure in a foreign-income tax return hides a decision: which exchange rate did you use, from which day? Most people improvise — Google's rate, a year-average, whatever the broker's app showed. The Income-tax Rules actually prescribe the answer, and it is more specific than almost anyone expects: Rule 115.
What Rule 115 says
Rule 115 requires foreign-currency income to be converted at the telegraphic transfer (TT) buying rate of the State Bank of India on a "specified date" — and for most income heads the specified date is the last day of the month immediately preceding the month in which the income arose. Two choices are made for you: the institution and rate type (SBI's TT buying rate — not RBI's reference rate, not a card rate, not Google), and the date (a month-end before the income, not the income date itself).
The specified date, by income type
| Income | Specified date (rate to use) |
|---|---|
| Dividend received in May | Last day of April |
| Broker interest credited in July | Last day of June |
| Capital gains — sale in September | Last day of August (for the proceeds leg) |
| Capital gains — cost of a lot bought in February | Last day of January (for the cost leg) |
A worked example: a $500 dividend credited on 15 May 2025 converts at SBI's TT buying rate for 30 April 2025. If that rate was ₹84.62, the Schedule OS amount is ₹42,310 — regardless of what the rupee did on 15 May.
Why the TT buying rate specifically
Banks quote several rates; the TT buying rate is what the bank would pay you for an inward remittance — typically a little below the interbank mid-rate. Rule 115 names it, which makes it the defensible choice: a return whose conversions all trace to dated SBI TT-buy rates is easy to support, while a mix of Google rates and averages is easy to challenge.
Income converts one way, balances another
The subtlety that catches even careful filers: Rule 115's preceding-month-end convention governs income. Schedule FA's values and balances — the peak value, closing value and initial value — are converted at the rate for their own dates, per the FA form's instructions. So the same dividend legitimately appears in Schedule OS at the preceding month-end's rate, while the holding it came from is valued at own-date rates in Schedule FA. That is not an inconsistency; it is two different rules applying to two different kinds of figures.
What this means in practice
- Every dividend, interest credit and closed lot in the year needs its own dated rate — for an active year that is easily dozens of distinct month-end lookups;
- Both legs of every capital gain get Rule 115 treatment — cost at the pre-acquisition month-end, proceeds at the pre-sale month-end — so the INR gain is not the USD gain times any single rate;
- Whatever convention you adopt, apply it uniformly and keep the rate used next to every converted amount, so your CA can verify rather than trust.
Frequently asked questions
What if the specified date falls on a weekend or bank holiday?
SBI publishes rates on working days; if the last day of the month was not one, the accepted practice is to use the last published rate on or before that date. The key is consistency — use the same convention for every amount in the return.
Can I use the RBI reference rate instead of SBI's rate?
Rule 115 specifically defines the telegraphic transfer buying rate by reference to the State Bank of India. RBI reference rates and Google exchange rates are close but not identical, and the rule names SBI — using anything else invites avoidable questions.
Does Rule 115 apply to Schedule FA values too?
Schedule FA's balances and values — peak, closing, initial value — are converted at the rate for their own dates, per the FA form's instructions. Rule 115's preceding-month-end convention applies to income: dividends, interest, and the cost and proceeds legs of capital gains.
Where do I find historical SBI TT buying rates?
SBI publishes daily forex card rates as PDFs on its website, but does not maintain a public history. Community-maintained archives of the daily sheets exist, and tools built for foreign-asset filing embed the historical series so each amount is matched to its correct dated rate automatically.