Free tool: TCS on foreign remittance calculator — TCS under LRS for 2026-27 — investments, education, medical and tour packages.
Rates from 1 April 2026
| Purpose | TCS |
|---|---|
| Education financed by a loan from a specified financial institution | Nil |
| Education (self-funded) or medical treatment | Nil up to ₹10 lakh a year; 2% above (was 5%) |
| Overseas tour packages | 2% on the whole amount (was 5% / 20%) |
| Everything else — investments, gifts, maintenance of relatives, property abroad | Nil up to ₹10 lakh a year; 20% above |
Section 394(1) of the Income-tax Act, 2025 (formerly section 206C(1G)).
The LRS limit
Resident individuals can remit up to USD 250,000 per financial year under RBI’s Liberalised Remittance Scheme, including to GIFT City. Companies investing abroad use the overseas direct investment route instead — see ODI rules.
Getting TCS back
- TCS is not an extra tax: it’s credited against your income tax for the year and shows in your tax credit statement (Form 168).
- If it exceeds your tax, you get a refund when you file your return.
- Salaried people can ask their employer to account for TCS when calculating TDS on salary, to avoid a cash-flow gap.
Planning tips
- The ₹10 lakh threshold is per person per year — family members each have their own.
- Education loans from specified institutions avoid TCS entirely.
- Investing in a US company you founded? That’s ODI with its own reporting — see US incorporation.
Frequently asked questions
What is the TCS rate on foreign remittance for investment in 2026-27?
Nil up to ₹10 lakh in a financial year and 20% on the amount above that, under section 394(1) of the Income-tax Act, 2025.
What is the TCS on education remittances from April 2026?
Nil if financed by a loan from a specified financial institution; otherwise nil up to ₹10 lakh and 2% above that (reduced from 5%).
Is TCS on LRS refundable?
TCS is credited against your income tax for the year; any excess is refunded when you file your income-tax return.
What is the LRS limit?
USD 250,000 per resident individual per financial year.
Please note: this guide is general information based on the rules as they stood on the review date above. Regulations and RBI/CBDT procedures change often — please get advice on your specific facts before acting.