Understanding the Liberalised Remittance Scheme(LRS)
What are the applicable taxes on gains and income in the US?
The two main streams of income from investments in stocks are dividend and capital gains.Dividend Income As per the India-US Double Taxation Avoidance Agreement (‘DTAA’), flat tax rate of 25% is applicable on dividend income earned, subject to ...
What is capital account and current account under LRS?
All transactions involving foreign exchange have been classified either as capital or current account transactions. Current Account is an account showing the trade of merchandise, whereas the Capital Account gives place to all capital transactions. ...
Can the resident remitter lend under the LRS?
Yes, the resident remitter can give loan to relatives (as defined under the Companies Act) abroad under LRS as extension of loans is a permissible capital account transaction.
What is capital account and current account under LRS?
All transactions involving foreign exchange have been classified either as capital or current account transactions. Current Account is an account showing the trade of merchandise, whereas the Capital Account gives place to all capital transactions. ...
Is the authorised bank required to check permissibility of remittances based on nature of transaction or allow the same based on remitters declaration?
The authorised dealer is guided by the nature of transaction as declared by the resident remitter in Form A2 and will thereafter certify that the remittance is in conformity with the instructions issued by the RBI in this regard from time to time. ...
How do I remit money outside India under LRS?
The RBI requires resident remitters to fill out and submit a Form A2, which is provided by RBI appointed authorized dealers (typically banks). The form captures the remittance amount, the purpose, and the individual’s PAN number. Once the form is ...
What is not allowed under the LRS?
Usually, you cannot remit money that comes from certain sources such as winnings from gambling and lottery, dividends from certain companies, and interest payments from non-resident rupee bank accounts. Individuals also cannot remit money for any ...
Who can avail LRS?
The LRS allows all resident individuals, including minors to freely remit. In case of minors, the LRS declaration form must be countersigned by the minor’s natural guardian. LRS is not available to corporates, partnership firms, HUF and Trusts. ...