Wheat sowing often gets delayed and the crop faces terminal heat stress, which is severely impacting the crop productivity. Synthetic osmolytes maintain structural integrity of cell membrane and protect oxidative damage of cells under stress conditions. Hence, foliar application of these compounds is likely to alleviate the negative effects of high temperature on crop plants. However, field response of these chemicals on late-sown wheat in the subtropical environment (eastern Indo–Gangetic Plain) is still uncertain. A field experiment was conducted for three years (2013–2016) to envisage the field efficacy of two synthetic compounds viz., potassium nitrate (KNO3) (1.0 and 0.5%) and glycine betaine (GB) (100 and 50 mM), each sprayed either at respective higher dose at booting or anthesis, or at half the dose at both booting and anthesis for improving grain yield of two contrasting wheat cultivars (DBW14 and K307) facing terminal heat stress. Foliar application of 0.5% KNO3 at both booting and anthesis stages resulted in the maximum increase (13–16%) in grain yield over no-spray treatment closely followed by 1% KNO3 at anthesis (10–14%), and 50 mM GB at both booting and anthesis stages (6–9%). However, foliar spray of KNO3 and GB at only booting stage had a non-significant effect on grain yield. The increase in grain yield with the osmolytes application was attributed to an increase in the number of grains ear− 1 (9–16%) and thousand-grain weight (3–10%), demonstrating an increased sensitivity of sink capacity and grain development of wheat to terminal heat stress. The degradation of flag leaf chlorophyll content (34–36%) and increase in the relative membrane permeability (29–52%) during anthesis to grain filling period was observed as the critical yield-limiting factors in late-sown wheat. Foliar spray of osmolytes had a regulatory effect on these physiological anomalies being highest with the treatment 0.5% KNO3 foliar spray at both booting and anthesis stages followed by 1% KNO3 foliar spray at anthesis. At the grain filling stage, significant relationships between grain yield and flag leaf chlorophyll (r = 0.43–0.68) and relative membrane permeability (r = − 0.47 to − 0.53) were observed. Thus, foliar application of 0.5% KNO3 at both booting and anthesis stages could be recommended to alleviate the adverse effect of terminal heat stress and improve productivity of late-sown wheat in subtropical environments.