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Liberalized Remittance Scheme LRS

Liberalized Remittance Scheme LRS

Resident Individual can remit up to USD 250,000 per financial year for capital / current account transactions

Permissible capital account transactions

1. opening of bank accounts abroad

2. purchase of property abroad

3. investments abroad

4. setting up Wholly owned subsidiaries and Joint Ventures abroad

5. loans including loans in INR to NRI relatives

Permissible current account transactions

1. private visits to any country (except Nepal and Bhutan)

2. gift or Donation

3. employment abroad

4. Emigration*

5. Maintenance of close relatives abroad

6. Business travel

7. Medical treatment abroad*

8. Studies abroad*

9. Any Other

* Can avail higher FE (> USD 250,000) if so required by

– Country of emigration

– Medical institute

– University

NRI / PIO can remit up to USD 1 million per financial year

-Subject to payment of applicable taxes in India

-From NRO account

-Sale proceeds from assets acquired by inheritance, legacy

-Deed of settlement

Funds from NRO a/c funds can be transferred to NRE a/c within overall limit of USD 1 million

NRE / FCNR account can be opened jointly with a resident relative

Immediately upon NRI returning to India :

1. NRE a/c : should be re-designated as resident / RFC account

2.  FCNR a/c : deposit allowed to continue till maturity. Except rate of interest & reserve requirements, for all other purposes such FCNR deposit shall be treated as resident deposit

Loan can be availed against NRE / FCNR account

1. for personal purposes or for carrying on business (excluding re-lending or carrying on agricultural activities or real estate business)

2. by Resident third party individuals, firm, Cos; provided there is no direct / indirect FE consideration to NRI depositor

3. Whether interest on NRE / FCNR is tax free even after NRI returns to India with an intention to stay for uncertain period, employment etc

4. Person resident in India cannot take outside India INR exceeding Rs 25,000

5. No person shall bring in India at one time FE in currency notes, bank notes, TCs exceeding USD 10000, of which currency notes cannot exceed USD 5000

6. A resident individual shall surrender the unused FE in from of currency notes, TCs etc within 180 days of his return to India

7. Indian Resident can retain FC notes, TCS not exceeding USD 2000

8. Foreign coins can be retained without limit 

Liberalized Remittance Scheme LRS

Liberalized Remittance Scheme LRS

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