AMENDMENT IN TCS PROVISIONS APPLICABLE FOR LIBERALISED REMITTANCE SCHEME (LRS) TRANSACTIONS W.E.F. JULY 1ST, 2023
Nipan Bansal
Managing Partner at Parshotam & Associates | Director at NRI Services Inc (Canadian Co.) | FEMA Practitioner | International Taxation Advisor | Insolvency Professional | E-Commerce Consultant
The Government of India vide Finance Act, 2023 has amended 206C (1G) of the Income Tax Act, 1961 (the Act). Pursuant to the amendment, effective 1 July 2023, there are changes in the Tax Collected at Source (TCS) applicable for all remittances made under Liberalised Remittance Scheme (LRS).
This communication is to update you on the key changes and what they mean for you.
Change in TCS rate and applicable threshold limits for overseas remittances.
The comparison between current TCS Provisions and revised TCS Policy are tabulated below:
Apart from the above changes in the TCS policy, other amendments were brought with respect to non-Tax filers and for pending 'PAN and Aadhaar' link customers, which will come in effect from 1 July 2023.
Please note while the TCS provisions are effective from 1 July 2023, some aspects of the overall TCS provisions/FEMA regulations are still under discussion with the Government and hence the provisions/regulations may still undergo some changes. We will keep you posted should there be any further changes.