Question 1

What is LRS (Liberalised Remittance Scheme) and what is the limit?

Accepted Answer

LRS is an RBI scheme allowing Indian residents to remit up to USD 250,000 (approximately Rs 2.1 crore) per financial year abroad for permissible purposes like travel, education, medical treatment, investments, and gifts. The limit is per individual per year - a family of 4 can remit up to USD 1 million collectively. Remittances above this limit require RBI approval.

Question 2

What are the TCS rates for different remittance purposes?

Accepted Answer

TCS rates (FY 2024-25): Education with Section 80E loan: 0% (no TCS). Education/Medical: 0.5% (no threshold). Travel packages: 0.5% up to Rs 7 lakh, then 20%. Foreign investments (shares, property, crypto): 20% on entire amount. Other purposes: 0.5% up to Rs 7 lakh, then 20%. The Rs 7 lakh threshold is cumulative across all purposes in a financial year.

Question 3

Can I get a refund of TCS collected on remittances?

Accepted Answer

Yes! TCS is not a final tax - it's an advance tax collected by banks. When you file your ITR, the TCS appears in Form 26AS as tax paid. If your total tax liability is less than TCS collected, you'll receive a refund. For example, if banks collected Rs 2 lakh TCS but your actual tax is Rs 1 lakh, you get Rs 1 lakh refund after filing ITR.

Question 4

How can I reduce TCS on foreign remittances?

Accepted Answer

Strategies to minimize TCS: (1) For education, take a Section 80E loan to get 0% TCS, (2) Split remittances across financial years to stay under Rs 7 lakh threshold, (3) Use multiple family members' LRS limits, (4) For investments, consider NRE route if you have NRI status, (5) Keep proper documentation to claim refund while filing ITR. Remember: TCS is refundable, so the real cost is the time value of money.

Question 5

What purposes are covered under LRS and which are not?

Accepted Answer

Permitted: Education, medical treatment, travel, private visits, gifts/donations, investment in shares/property abroad, maintenance of relatives, business trips. NOT permitted: Lottery/gambling, trading on forex platforms, capital account transactions without RBI approval, remittance to countries under FATF/OFAC sanctions (Iran, North Korea, etc.), margin trading/commodity exchanges. Always use correct purpose code to avoid RBI scrutiny.

LRS & TCS on Remittances Calculator

Quick answers

Related Calculators

FEMA Compliance & Remittance Tracker

NRI Repatriation Limit Tracker

NRI Account Comparison & Taxation

Related Articles

Foreign Remittance Compliance 2025: Form 15CA/15CB Updates and LRS Rules

NRI Investment Options in India: Mutual Funds, Stocks, Property & More

Form 15CA & 15CB for NRI: Complete Filing Guide with Examples

Budget 2025 Impact on NRIs: 8 Tax Changes You Can't Afford to Miss

NRI Bank Accounts: NRE vs NRO vs FCNR Complete Comparison

Related Tax Hacks

ELSS for NRI Tax Saving

Form 15CA Withdrawal Trick

Section 10(4B) FX Exemption

NRO to NRE Direct Transfer

USD 1M Repatriation Split

Need help with your calculation?