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By the NRIWallah team · Last reviewed: August 2026

TCS on money sent out of India

Section 206C(1G) in one calculator — with the direction error corrected first, because most people searching for this are worried about the wrong way round.

First, the direction — because most people have it backwards.

This transfer

Across every bank, April to March. This is the number that decides whether your exemption is still available.

What gets collected

Free of TCS (threshold left)
Taxable slice
Above the threshold Exempt — loan-funded
TCS collected
Effective rate on the transfer
Total leaving your account

After this you'll have of the annual exemption left.

This uses up your annual exemption. Everything else you send before 31 March is taxable from the first rupee.

Tour packages have no exempt slice — TCS starts at the first rupee.

This is not a cost

The same , sent for a different reason

PurposeRateTCSvs your choice

The purpose you declare to your bank decides the rate, and you must be able to evidence it. Declaring education to get 5% on what is really a gift is a false declaration, not a strategy.

Splitting the transfer does not avoid it

Two transfers of are not two exempt transfers. The first is free; the second is taxed on of its — , an effective on that second transfer alone.

Two rules people still quote that no longer exist

Rates for FY , reviewed . Source: .

Common Questions

None. There is no TCS on money coming into India. Section 206C(1G) applies to remittances leaving India under the Liberalised Remittance Scheme, and the LRS is open only to individuals resident in India — an NRI cannot use it and so can never fall within this section. Funding an NRE or NRO account, supporting family, paying for a property, repaying a loan: all of it arrives without any tax collected at source. This is the single most common misunderstanding about TCS, and it causes NRIs to worry about a charge that cannot apply to them.
When money moves the other way. Your parents in India sending you money abroad, a sibling gifting you funds, family paying your children’s overseas school fees, or a resident relative investing in foreign shares on your advice — all of that is an outward LRS remittance and all of it can attract TCS. It also matters if you return to India and become resident again, at which point you fall inside the scheme yourself and your own transfers abroad start attracting it.
Nothing is collected until aggregate remittances in the financial year exceed ₹10 lakh. Above that, education and medical treatment attract 5% on the excess, and everything else attracts 20% on the excess. A remittance funded by an education loan from a financial institution under section 80E(3)(b) attracts nothing at all, whatever the amount. Overseas tour packages follow different rules: 5% from the first rupee on payments up to ₹10 lakh and 20% above, with no exempt slice at all.
It was, until the Finance Act 2025 raised it to ₹10 lakh with effect from 1 April 2025. A great deal of published guidance still quotes ₹7 lakh, including material that looks current. The same Act removed TCS entirely on remittances funded by qualifying education loans, which had previously been charged at 0.5%. If a source you are reading says ₹7 lakh, it predates April 2025.
No. The ₹10 lakh threshold is an aggregate for the whole financial year across every bank you use — not per transaction and not per bank. Your bank collects a declaration of what you have already remitted elsewhere and aggregates it. Two transfers of ₹8 lakh do not give you two exemptions: the first is free, and the second is taxed on ₹6 lakh of its ₹8 lakh, which works out at an effective 15% on that second transfer for a non-education purpose. The calculator above shows this directly.
No, and this is the most important thing to understand about it. TCS is a prepayment of your own income tax, not a charge on the transfer. The amount is deposited against your PAN, appears in your Form 26AS and Annual Information Statement, and is set off against your income tax liability for the year. If your liability is smaller than what was collected, the balance is refunded when you file. What it genuinely costs you is the use of the money in the meantime — which for a 20% collection on a large remittance can be a substantial sum tied up for the best part of a year.
If you are salaried, yes. Section 192(2B), as amended by the Finance Act 2024, lets you declare tax collected at source to your employer so that it is set off against the TDS on your salary rather than sitting with the department until you file. The declaration is made on Form 12BAA, notified by CBDT Notification No. 112/2024 dated 15 October 2024 and since consolidated into Form 122. Most employees do not know this exists and simply wait for the refund.
It is the largest variable on the page. On a ₹25 lakh remittance, education or medical costs ₹75,000 and anything else costs ₹3,00,000 — four times as much for identical money moving to an identical account. That is a strong incentive to declare a favourable purpose, and it should be resisted: the purpose is declared to your bank, must be evidenced with documentation, and describing a gift as education is a false declaration rather than a planning technique. Where the purpose genuinely is education, the documentation is worth assembling properly.
Section 206CC requires collection at twice the specified rate, or 5%, whichever is higher, where PAN has not been furnished — so a 20% remittance becomes 40%. In practice this is an edge case, because the remitter under LRS is a resident individual who will hold a PAN in almost every case. Whether that provision can override the nil rate on loan-funded education remittances is not settled in the published guidance; if it matters to your situation, ask your bank what it will actually do before you remit.
Both are gone. Section 206CCA, which collected at double rate from people who had not filed returns, was omitted with effect from 1 April 2025. Section 206C(1H), the 0.1% on sales of goods above ₹50 lakh, was withdrawn from the same date. They are still widely quoted in guidance written before that, so it is worth checking the date on anything you read.
The rates and thresholds come from the CBDT’s own published TCS Rates page, which carries its own review date and is linked beneath the calculator. That is the authority for this. What the tool cannot know is how your bank will treat your particular transfer: the rate depends on the purpose you declare, the documentation you provide, and the aggregate the bank computes from your declarations. Your bank is the collector and its assessment is what actually happens. Treat this as the expected position and confirm before remitting anything large.

Sending a large sum out of India?

If the amount is significant or the purpose is not clear-cut, the difference between 5% and 20% is worth getting right in advance. Tell us the shape of the transfer.

Something went wrong. Please email admin@nriwallah.com directly.

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Every rate and threshold here is sourced, dated and shown on the page — but tax rules change, and we would rather be told than be wrong. Reports go to the team that maintains the tool. If you can point at the official source, that gets it fixed fastest.

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Prefer email? admin@nriwallah.com. How we source and review these numbers is set out in our methodology.

Most people searching for this have the direction wrong

Type “TCS on remittance to India” into a search box and you will find a great deal of anxious writing. Almost all of it is answering a different question from the one being asked.

There is no TCS on money coming into India. None. An NRI funding an NRE account, supporting parents, paying for a flat or repaying a loan sends money that arrives with nothing collected at source.

Tax collected at source under section 206C(1G) applies to money leaving India under the Liberalised Remittance Scheme. And the LRS is open only to individuals resident in India — an NRI cannot use the scheme, and therefore cannot fall within the section at all.

So if you are an NRI worrying about TCS on the money you send home, you can stop.

When it does affect you

It affects the other direction, and that direction is full of NRI money.

Your parents in India sending you funds abroad. A sibling gifting you money. Family paying your children’s overseas school fees. A resident relative buying foreign shares. All of that is an outward LRS remittance, and all of it can attract TCS at rates that reach 20%.

It also starts applying to you personally the moment you move back and become resident again — at which point your own transfers out of India fall inside the scheme.

The rates, and the one that saves the most

Nothing is collected until your aggregate remittances for the financial year pass ₹10 lakh. Above that line:

  • Education or medical treatment — 5% on the excess
  • Everything else — 20% on the excess
  • Education funded by a qualifying education loan — nil, whatever the amount

That last one is worth pausing on. A family funding a degree abroad from savings pays 5% above the threshold. The identical fee, paid from a loan taken under section 80E(3)(b) from a financial institution, attracts nothing at all. The Finance Act 2025 removed the 0.5% that used to apply to loan-funded remittances, so this is now a complete exemption rather than a reduced rate.

Overseas tour packages follow different rules entirely. There is no exempt slice: 5% is collected from the first rupee on payments up to ₹10 lakh, and 20% above. Booking flights and hotels separately is not a “package” and falls under the ordinary LRS rules instead — which, below ₹10 lakh, means nothing is collected.

If a source says ₹7 lakh, it is out of date

The threshold was ₹7 lakh until the Finance Act 2025 raised it to ₹10 lakh with effect from 1 April 2025.

A lot of guidance still quotes the old figure, including material that reads as current. Two other provisions people continue to cite have also gone: section 206CCA, which doubled the rate for those who had not filed returns, was omitted from 1 April 2025, as was section 206C(1H) on sales of goods above ₹50 lakh.

Check the date on anything you read about this.

Splitting the transfer does not work

The threshold is an aggregate for the financial year, across every bank you use. Not per transaction. Not per bank.

Your bank collects a declaration of what you have already remitted elsewhere and aggregates it. So two transfers of ₹8 lakh are not two exempt transfers — the first is free, and the second is taxed on ₹6 lakh of its ₹8 lakh. For a non-education purpose that is ₹1,20,000, an effective 15% on the second transfer despite each one sitting comfortably below the headline threshold.

It is a prepayment, not a charge

This is the part that gets lost in the alarm about a 20% rate.

TCS is not a tax on the transfer. It is a prepayment of your own income tax. The amount is deposited against your PAN, shows up in your Form 26AS and Annual Information Statement, and is set off against your income tax liability for the year. If your liability comes to less than what was collected, the difference is refunded when you file.

What it genuinely costs you is the use of the money in the interim. On a large remittance at 20%, that can be a significant sum sitting with the department for the better part of a year.

Salaried remitters need not wait. Section 192(2B), as amended by the Finance Act 2024, lets you declare tax collected at source to your employer so it is set off against the TDS on your salary. The declaration goes on Form 12BAA, notified by CBDT in October 2024 and since consolidated into Form 122. Very few people use it.

If you are the one receiving the money, nothing here applies to you — but gift tax in India might, depending on who sent it and whether they count as a relative under section 56(2)(x). If you are moving money the other way out of an NRO account, the repatriation calculator covers the USD 1 million route and the Form 15CA/15CB paperwork, which carries TDS under section 195 rather than TCS. And if a return to India is on the cards, moving back to India covers the point at which these rules start applying to you.

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