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The Rs 7 lakh threshold for LRS is a combined threshold, applicable to TCS on all LRS transactions, regardless of the purpose of the remittance. Whether you're paying for education, medical treatment, or for other general purposes, all of these expenses contribute to the same Rs 7 lakh limit.

The RBI introduced the LRS scheme or Liberalised Remittance Scheme to facilitate hassle-free foreign exchange. Under this scheme, an Indian resident can transfer funds of up to USD 250,000 in a financial year outside India.

Liberalised Remittance Scheme (LRS) was brought into effect by the Reserve Bank of India in 2004. ing to it, residents of India can remit a maximum of $250,000 within a given financial year to individuals living overseas. This includes both capital and current account transactions.

Under the Liberalised Remittance Scheme, all resident individuals, including minors, are allowed to freely remit up to USD 2,50,000 per financial year (April ? March) for any permissible current or capital account transaction or a combination of both.

In case the remittance above Rs 7 lakh is paid via a loan from an authorised financial institution then a TCS of 0.5 per cent would be levied. While, remittances of more than Rs 7 lakh spent on foreign education would attract a TCS of 5 per cent from October 1, 2023.

On the other hand, if you have invested in Indian mutual funds that deal in foreign investments, it won't be considered as a remittance under the LRS scheme and hence, wouldn't attract any TCS.

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