New 20% TCS on international credit card spend explained: Travelling abroad or using LRS? Watch to know tax rules
In this week’s episode of TOI Wallet Talks, Russell Gaitonde, Partner at Deloitte India simplifies the new rules with regards to higher TCS on transfers made under the LRS. He explains in detail about the TCS rules for use cases such as students studying abroad on education loans, spending on medical expenditure out of India, holidaying with your family or individually and the use of credit cards and debit cards internationally.
20% tax on foreign spending, travel via international credit cards – Explained I TCS, LRS New Rules
Watch the video above to know on what transactions the higher 20% TCS rate is applicable from July 1, 2023. Also, find out on what spending the Rs 7 lakh threshold limit of no TCS is applicable.
If you are planning to travel abroad after July 1, 2023 then the video above is your guide to understanding the percentage of tax you will have to shell out when spending abroad, especially via credit cards which have now been included in the ambit of LRS.
In the video above, Russell Gaitonde also explains the procedure to claim a refund against the TCS payment if applicable at the time of filing your income tax return.
Under the Liberalised Remittance Scheme, Indian residents are allowed to remit funds outside India to a maximum limit of $2,50,000 in a financial year. This limit of $2,50,000 also includes any remittances within India for any gifts or loans to Non-Resident Indians (NRIs) or investments that are made via the GIFT City units.