No TCS on overseas spending through international debit or credit cards up to Rs 7 lakh per financial year: Centre
New Delhi: The Centre on Friday announced that individuals who use their international debit or credit cards for payments, up to Rs 7 lakhs per financial year, will be exempted from the limits set under the Liberalized Remittance Scheme (LRS).
Additionally, these transactions will not be subject to Tax Collected at Source (TCS). The government also confirmed that the current beneficial treatment of TCS for education and health payments will continue to be in effect.
“Concerns have been raised about the applicability of Tax Collection at Source (TCS) to small transactions under the Liberalized Remittance Scheme (LRS) from July 1, 2023.
"To avoid any procedural ambiguity, it has been decided that any payments by an individual using their international Debit or Credit cards upto Rs 7 lakh per financial year will be excluded from the LRS limits and hence, will not attract any TCS,” the Finance Ministry said in a statement.
Existing beneficial TCS treatment for education and health payments will also continue, the statement said.
This relaxation shall not be available for any remittances made from India. Thus, any remittance for investment, ticket booking, purchase of goods, payment of subscription fees, etc., shall continue to be subject to TCS at 20%.
“The necessary changes to the Rules (Foreign Exchange Management (Current Account Transactions Rules), 2000) will be issued separately,” it added.
IBNS
Senior Staff Reporter at Northeast Herald, covering news from Tripura and Northeast India.
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