What is Tax Collected at Source (TCS) on global investments?
As per the Union Budget 2020, under the Liberalised Remittance Scheme (LRS):
- 5% Tax Collected at Source (TCS) is applicable on remittances aggregating to Rs. 7 lakhs or more in a financial year.
- It is applicable on the amount exceeding Rs. 7 lakhs (and not on the total amount).
For example, Mr Ravi transfers Rs. 10 lakhs abroad in a financial year as per LRS provisions. TCS will be applicable on Rs. 3 lakhs (Rs. 10 lakhs - Rs. 7 lakhs) i.e., Rs. 15,000.
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