20% TCS to apply for all purposes under LRS, except Overseas Education & Overseas Medical Expenditure
W.e.f 1 July 2023, Finance Act 2023 has introduced certain changes to the Tax Collection at source (TCS) on Forex drawls/ remittances by Resident Individuals under LRS (Liberalised Remittance Scheme).
Press Release
Official Press Release – Link here
Official Notifications
We request you to make note of the revised TCS rates applicable from 1 July 2023.
| Sr No | Type of Remittance Abroad | Revised TCS Guidelines (w.e.f 1 July 2023) |
| 1 | For the purpose of education, if the amount being remitted is from a loan obtained from any specified institution as defined in Section 80E | 0.5% of the amount or the aggregate amount over Rs. 7 lakh per financial year |
| 2 | For the purpose of education, other than(1) or for the purpose of medical treatment. | 5% of the amount or the aggregate amount over Rs. 7 lakh per financial year |
| 3 | Overseas tour packages | 20% without any threshold limit of Rs 7 lakhs per financial year |
| 4 | Any other purpose under LRS | 20% without any threshold limit of Rs 7 lakh per financial year |
| 5 | Resident Individual falling under “Specified Person” category/Non-PAN case/ inoperative PAN case | Double the normal rate of TCS or 5%, whichever is higher. However, TCS rate shall not exceed 20%. |
Note:
- Threshold limit of Rs 7 lakh per financial year mentioned in 1&2 above is aggregate threshold of all Forex withdrawals availed by the customer under LRS from our Bank across all the products (Outward Remittances, Forex Cards, FCY Cash, FCY DD, Debit Card – International Spends)
- PAN should be valid and operative from 1 July 2023 i.e., the Bank will check validity of PAN in terms, whether Aadhaar is linked to PAN or not. In case PAN is inoperative, TCS would be charged at the rate applicable to Non-PAN case.
Definition of Specified Person:
“Specified Person” means a person who satisfies both the following conditions
1- He has not furnished the return of income for the assessment year relevant to the previous year immediately preceding the financial year in which tax is required to be deducted/collected. The previous year to be counted is required to be the one whose return filing date under sub-section(1) of section 139 has expired.
2- Aggregate of tax deducted at source and tax collected at source is Rupees Fifty thousand or more in that previous year.
For any further queries, Contact us here
