New Delhi, May 5 — The Government of India has officially revised the Tax Collected at Source (TCS) rates for foreign currency transactions under the Liberalised Remittance Scheme (LRS), with new rates coming into force from April 1, 2025. The changes apply to all resident individuals sending money abroad or buying foreign currency for various purposes.
As per the updated structure, TCS on education-related remittances using loans from recognised institutions remains exempt. For education and medical treatment expenses not funded through a loan, no TCS will be collected for amounts up to ₹10 lakh. However, beyond this threshold, the rate is 5% if the PAN is active, and 10% if it is inoperative.
For all other categories under LRS—including travel, gifts, and investments—remittances up to ₹10 lakh in a financial year will not attract TCS. But if the remitted amount crosses this limit, a 20% TCS will be levied, regardless of PAN status. This includes transactions such as booking foreign hotels or air tickets via an HDFC Bank account or any other mode.
The ₹10 lakh ceiling is cumulative across all foreign exchange transactions made by an individual in a financial year, tracked per PAN, no matter the bank or payment method used.
The Finance Ministry also reminded citizens about the status of inoperative PANs. A PAN becomes inoperative if it was issued before July 1, 2017, and has not been linked with Aadhaar by the March 31, 2022, deadline for eligible individuals. In such cases, higher TCS rates apply automatically.
To avoid unnecessary deductions, individuals are advised to check and confirm their PAN-Aadhaar linkage and plan their overseas remittances accordingly—especially if they anticipate crossing the ₹10 lakh threshold in any financial year.
Revised TCS Rates on Foreign Exchange Transactions Under LRS Effective from April 1, 2025
0 Comments 
