{"id":12503,"date":"2023-06-26T07:09:04","date_gmt":"2023-06-26T01:39:04","guid":{"rendered":"https:\/\/vajiramandravi.com\/current-affairs\/?p=12503"},"modified":"2025-04-01T19:38:30","modified_gmt":"2025-04-01T14:08:30","slug":"what-is-the-liberalised-remittances-scheme-lrs","status":"publish","type":"post","link":"https:\/\/vajiramandravi.com\/current-affairs\/what-is-the-liberalised-remittances-scheme-lrs\/","title":{"rendered":"What is the Liberalised Remittances Scheme (LRS)?"},"content":{"rendered":"<h2><strong>About Liberalised Remittances Scheme (LRS)<\/strong><\/h2>\n<ul>\n<li>LRS <strong>allows Indian residents to freely remit up to USD $250,000 per financial year<\/strong> <strong>for current or capital account transactions<\/strong> or a combination of both. Any remittance exceeding this limit requires prior permission from the RBI.<\/li>\n<li>The scheme was <strong>introduced by RBI on February 4, 2004.<\/strong><\/li>\n<li><strong>Who can remit funds under LRS?<\/strong>\n<ul>\n<li><strong>Only individual Indian residents, including minors<\/strong>, are permitted to remit funds under LRS.<\/li>\n<li><strong>Corporates, partnership firms, HUF, trusts<\/strong>, etc., <strong>are excluded <\/strong>from its ambit<strong>.<\/strong><\/li>\n<\/ul>\n<\/li>\n<li><strong>Frequency of Remittances:<\/strong>\n<ul>\n<li>There are <strong>no restrictions on the frequency<\/strong> of remittances under LRS.\u00a0<\/li>\n<li><strong>Once a remittance is made for an amount up to USD 2,50,000<\/strong> during the financial year, a resident individual <strong>would not be eligible to make any further<\/strong> remittances under this scheme.<\/li>\n<\/ul>\n<\/li>\n<li>\u00a0<strong>Types of transactions permitted:<\/strong>\n<ul>\n<li><strong>Opening of foreign currency account abroad<\/strong> with a bank;<\/li>\n<li>\u00a0<strong>Acquisition of immovable property abroad<\/strong>, overseas direct investment (ODI), and overseas portfolio investment (OPI);<\/li>\n<li><strong>Extending loans<\/strong>, including loans in Indian Rupees to non-resident Indians (NRIs) who are relatives as defined in the Companies Act, 2013;<\/li>\n<li><strong>Private visits abroad<\/strong> (excluding Nepal and Bhutan);<\/li>\n<li>\u00a0<strong>Maintenance of relatives abroad<\/strong>;<\/li>\n<li><strong>Medical treatment<\/strong> abroad;<\/li>\n<li><strong>Pursuing studies<\/strong> abroad;<\/li>\n<\/ul>\n<\/li>\n<li>\u00a0The <strong>Union Budget 2023 introduced a Tax Collection at Source (TCS) for outward foreign remittance under LRS<\/strong> (other than for Education and medical purpose) <strong>of 20%<\/strong> on the entire value.<\/li>\n<li><strong>Tax liability on profit made<\/strong>: <strong>If any profit is made <\/strong>on foreign investments made under LRS, <strong>it is taxable in India based on how long the investment was held.<\/strong><\/li>\n<\/ul>\n<p>&nbsp;<\/p>\n<hr \/>\n<h3><strong>Q)\u00a0What is Tax Collection at Source (TCS)?<\/strong><\/h3>\n<p>Tax collection at source (TCS) is an additional amount collected as tax by a seller of specified goods from the buyer at the time of sale over and above the sale amount and is remitted to the government account.<\/p>\n<p><a href=\"https:\/\/indianexpress.com\/article\/business\/banking-and-finance\/banks-readying-systems-to-track-spends-on-outward-remittances-8685919\/\" target=\"_blank\" rel=\"nofollow noopener\"><u>Banks readying systems to track spends on outward remittances<\/u><\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Liberalised Remittances Scheme allows Indian residents to freely remit up to USD $250,000 per financial year.<\/p>\n","protected":false},"author":5,"featured_media":12504,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[1],"tags":[],"class_list":{"0":"post-12503","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-upsc-prelims-current-affairs","8":"no-featured-image-padding"},"acf":[],"_links":{"self":[{"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/posts\/12503","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/users\/5"}],"replies":[{"embeddable":true,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/comments?post=12503"}],"version-history":[{"count":0,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/posts\/12503\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/media\/12504"}],"wp:attachment":[{"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/media?parent=12503"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/categories?post=12503"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/tags?post=12503"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}