Chartered Accountant · ICAI M.No. 153926 · FRN 136869W
When TCS applies
Under the RBI’s LRS, a resident can remit money abroad — for travel, investment, gifts and so on — and the bank collects TCS on it. The broad rule is 20% on the amount above a ₹10 lakh threshold in a financial year, with concessional treatment for some purposes. Thresholds and rates by purpose change — confirm the current LRS TCS rules.
Lower rates for education and medical
Education and medical remittances are treated more gently — lower or nil TCS, especially where funded by an education loan. Ordinary investments or overseas travel packages attract the higher rate. The point of TCS here is information-gathering, not extra tax.
You get it back — an example
Example: you remit ₹30 lakh abroad to invest. TCS of 20% applies on the ₹20 lakh above the threshold — ₹4 lakh — collected by the bank and deposited against your PAN. You then claim it as a credit in your return, getting it refunded if it exceeds your tax. So it is a cash-flow timing issue, not a permanent cost. Our team can ensure you reclaim it.