Sending money abroad will now be a costly affair except for educational fees and medical treatment as the new Budget 2023 announced by Finance Minister Nirmala Sitharaman on Wednesday.
New Delhi: Sending money abroad will now be a costly affair as the new Budget 2023 announced by Finance Minister Nirmala Sitharaman on Wednesday. Whether you are paying for the day-to-day expenses of your child studying abroad or investing in foreign equities, it will now be dearer as per the Union Budget for fiscal 2024. The new amendment will come into force from July 1, 2023.
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However, the tax collection at source (TCS) norms remain unchanged for educational fees and health-related. “The rate of TCS for foreign remittances for education and for medical treatment is proposed to continue to be 5 per cent for remittances in excess of Rs 7 lakh. Similarly, the rate of TCS on foreign remittances for the purpose of education through loan from financial institutions is proposed to continue to be 0.5 per cent in excess of Rs 7 lakh,” Sitharaman said in her Budget speech.
“However, for foreign remittances for other purposes under LRS and purchase of overseas tour program, it is proposed to increase the rates of TCS from 5 per cent to 20 per cent,” the finance minister said.
According to the Union Budget 2023 memorandum, “Section 206C of the Act provides for TCS on business of trading in alcohol, liquor, forest produce, scrap etc. Sub-section (1G) of the aforesaid section provides for TCS on foreign remittance through the Liberalised Remittance Scheme and on sale of overseas tour package.”
“In order to increase TCS on certain foreign remittances and on sale of overseas tour packages, amendment is proposed in sub-section (1G) of section 206C of the Act.”
