Key Features of #LRS under #FEMA
- Liberalised Remittance Scheme (LRS) was introduced in 2004 with the objective to facilitate #Resident individual to remit funds abroad for permitted Capital or current account Transactions or combination of both.
- Presently, Resident individual can remit up to USD 250,000 per FY (April to March) including minors BUT not available for other than individual.
- Permissible capital account transactions under this scheme are:
I) Opening foreign currency bank accounts overseas;
II) Acquisition of Immovable property, overseas direct investment i.e. capital contribution for business set up overseas and Overseas Portfolio Investment i.e. #investment in foreign securities;
III) extending loan to #NRI relatives subject to new rules, regulations and directives for overseas investment in 2022.
- Most of the current accounts transactions are permissible like #remittance for business, personal nature.
- Un-utilised fund remitted under this scheme needs to repatriated and surrendered to AD bank in India within 180 days from date of the receipt.
- Recently government has introduced tax collection at source (#TCS) provisions to track all remittances under this scheme.
- Resident individuals needs to disclose all his overseas assets and income in his tax return every year and non-disclosure shall invite very harsh penalties and prosecution under Black Money Act.