India TCS Calculator: Tax Collected at Source on Foreign Remittance
Work out the Indian TCS (Tax Collected at Source) on a foreign remittance under the Liberalised Remittance Scheme (LRS) — and the total outflow including the tax — for sending money abroad, overseas tour packages, and foreign investments.
Adjust the inputs and select Calculate for a full breakdown.
Compare Common Scenarios
How the numbers shift across typical situations for this calculator:
| Scenario | TCS collected | Total outflow with TCS |
|---|---|---|
| 20% of ₹10L above threshold (₹2L) | $200,000.00 | $1,200,000.00 |
| 5% of ₹5L (education above threshold) | $25,000.00 | $525,000.00 |
| 0.5% of ₹8L (education loan) | $4,000.00 | $804,000.00 |
| 20% of ₹3L (overseas tour package) | $60,000.00 | $360,000.00 |
How This Calculator Works
Enter the remittance amount above the annual LRS threshold and the TCS rate. The calculator returns the TCS collected and the total outflow. TCS is collected by the bank or remittance provider at the time of the transaction on amounts above the threshold; it's not an extra tax you lose — it's a prepayment of your income tax that you can claim back or adjust when you file your return.
The Formula
Percentage Add-On
Rate is the tax or tip percentage applied to the amount
Worked Example
On a ₹10,00,000 remittance above the threshold at 20%, the TCS is ₹2,00,000, so ₹12,00,000 leaves your account in total. Under the LRS, resident individuals can remit up to a yearly limit abroad. TCS applies above an annual threshold (currently ₹7 lakh) at 20% for most purposes (foreign travel, investments, gifts), with a concessional rate for education and medical remittances. Crucially, TCS is not a final tax — it's collected upfront and credited against your income tax, refundable if your liability is lower.
Key Insight
TCS on foreign remittance is widely misunderstood, so the key reassurance first: it is not an additional tax you lose — it's a prepayment of your own income tax, collected at source by the bank/remittance provider, that appears in your Form 26AS/AIS and is fully adjustable against your tax liability or refundable when you file your return. So the ₹2,00,000 in the example isn't a cost; it's your money parked with the tax department until you reconcile it (the real cost is the cash-flow/opportunity impact of paying it upfront and waiting for the refund). The rules: it applies to remittances under the Liberalised Remittance Scheme (LRS) — the framework letting resident individuals send money abroad up to an annual limit for permitted purposes (travel, education, medical treatment, investment, gifts, maintenance of relatives). TCS kicks in only on amounts above the annual threshold (currently ₹7 lakh per financial year, aggregated across remittances), and the rate depends on purpose: 20% for most remittances and overseas tour packages, a concessional 5% for education and medical (and as low as 0.5% for education funded by an education loan). Practical implications: large foreign investments, overseas property, big international trips, or supporting family abroad can trigger significant upfront TCS, so plan cash flow; keep records to claim the credit; and salaried taxpayers can sometimes have employers factor TCS into TDS to ease the cash-flow hit. This calculator shows the TCS on the above-threshold portion at your chosen rate and the gross outflow; remember it's recoverable, confirm the current threshold and purpose-specific rates (these have changed recently and can change again), and note that the threshold applies per financial year across your aggregate LRS remittances.
The ₹7 lakh threshold and the 20% rate above it
TCS on Liberalised Remittance Scheme (LRS) operates as follows: foreign remittances up to ₹7 lakh per financial year are exempt from TCS (no withholding). Above ₹7 lakh, TCS applies at differential rates depending on purpose: 20% for general remittances, foreign travel packages, and overseas investments; 5% for education and medical-treatment remittances; 0.5% on certain education-loan remittances.
Concrete example: an investor planning to invest ₹15 lakh in US stocks. First ₹7 lakh: no TCS. Next ₹8 lakh: 20% × ₹8 lakh = ₹1.6 lakh TCS withheld at source by the bank. The investor sends ₹13.4 lakh to the US broker; ₹1.6 lakh stays with the Indian government as advance tax.
TCS is NOT a final tax — it's advance tax that can be claimed against your annual income tax liability. If your total advance tax (TDS + TCS + advance tax) exceeds your final liability, you get a refund. If your liability is higher (because the foreign investment generated significant gains), TCS just reduces what you owe at year-end. The cash-flow drag is real, but the cumulative tax burden doesn't increase.
Education and medical remittances: the 5% / 0.5% concessions
Recognizing that education and healthcare are essential international expenditures, the Finance Act provides reduced TCS rates. For education remittances funded BY education loans: 0.5% TCS on amount above ₹7 lakh — the lowest rate. For other education remittances (self-funded studies abroad) and medical-treatment remittances: 5% TCS above ₹7 lakh.
Concrete example: a student family sending ₹40 lakh to a US university for tuition + living expenses. If self-funded: first ₹7 lakh exempt, next ₹33 lakh at 5% = ₹1.65 lakh TCS. If funded via a sanctioned education loan: 0.5% on ₹33 lakh = ₹16,500 TCS — dramatically lower.
Documentation required: students need to show admission letters, fee schedules, and (for the 0.5% rate) sanctioned education-loan documents from a recognized Indian bank. Medical remittances need hospital invoices, doctor recommendations, treatment estimates. Banks verify these before applying the reduced TCS rate.
Claiming the TCS back: TCS Certificate and tax return
TCS withheld is reflected in Form 26AS (your tax credit statement) and the Annual Information Statement (AIS). When filing your annual income tax return (ITR), you claim the TCS as a credit against total tax liability — exactly like TDS.
Process: (1) Bank issues TCS Certificate (Form 27D) for each transaction; (2) TCS reflected in 26AS within 30-45 days; (3) When filing ITR, enter total TCS in the relevant section; (4) Tax software auto-applies the credit against tax payable; (5) If TCS > liability, refund processed (typically 30-90 days post-ITR filing).
For high-net-worth investors making large foreign remittances, the cash flow drag of TCS (especially the 20% rate) can be substantial. Some structure remittances across multiple family members' LRS accounts (each member has separate ₹7 lakh threshold), or time large remittances near the start of the financial year (maximizing the gap before refund), or use education-purpose remittances where applicable. The strategies don't reduce total tax — they manage timing.
TCS rates by remittance purpose and amount above ₹7L
TCS withheld at source by the bank or remitter on amounts ABOVE ₹7 lakh in a financial year. Below ₹7 lakh: no TCS. Rates vary by purpose.
| Remittance purpose | Amount above ₹7L | TCS rate | Example: ₹20L remittance |
|---|---|---|---|
| General (investment, gifts, family support) | Above ₹7L | 20% | ₹2.6 lakh TCS (20% × ₹13L) |
| Foreign travel packages | Above ₹7L | 20% | ₹2.6 lakh TCS |
| Education (self-funded) | Above ₹7L | 5% | ₹65,000 TCS |
| Medical treatment abroad | Above ₹7L | 5% | ₹65,000 TCS |
| Education funded by education loan | Above ₹7L | 0.5% | ₹6,500 TCS |
TCS is recoverable against annual income tax liability via Form 26AS credit. Refundable if total tax credit exceeds liability. Documentation required to qualify for reduced rates (admission letters, hospital invoices, loan sanctions).
Frequently Asked Questions
How is TCS on foreign remittance calculated?
Multiply the remittance amount above the annual threshold by the TCS rate. On ₹10,00,000 above the threshold at 20%, TCS is ₹2,00,000, so ₹12,00,000 leaves your account. TCS applies only to the portion exceeding the threshold (currently ₹7 lakh per financial year).
Is TCS an extra tax I lose?
No — this is the key point. TCS is a prepayment of your own income tax, collected upfront by the bank/provider. It shows in your Form 26AS/AIS and is fully adjustable against your tax liability or refundable when you file. The only real cost is the cash-flow impact of paying it upfront and waiting to reconcile it.
What is the LRS?
The Liberalised Remittance Scheme — the RBI framework allowing resident individuals to remit money abroad up to an annual limit for permitted purposes: foreign travel, education, medical treatment, investment, gifts, and maintenance of relatives. TCS applies to LRS remittances above the annual threshold.
What are the TCS rates?
Above the threshold, 20% for most remittances and overseas tour packages; a concessional 5% for education and medical remittances; and as low as 0.5% for education funded by an education loan. The rate depends on the purpose of the remittance. Rates and the threshold have changed recently, so verify current figures.
How do I get the TCS back?
Claim it as a credit when filing your income tax return — it's adjusted against your total tax liability, and any excess is refunded. It appears in your Form 26AS/AIS. Salaried taxpayers can sometimes ask their employer to factor TCS into TDS to ease the upfront cash-flow hit. Keep your remittance records to substantiate the credit.
References & Authoritative Sources
- RBI — Reserve Bank of India — Liberalised Remittance Scheme (LRS) framework · consulted May 31, 2026 · Central bank — LRS framework, $250,000/year cumulative remittance limit
- Income Tax Department of India — TCS on foreign remittances — Section 206C(1G) · consulted May 31, 2026 · Tax authority — TCS rates, applicability, claim process via Form 26AS
- CBDT — Central Board of Direct Taxes — Notification on TCS rate changes and education loan provisions · consulted May 31, 2026 · Administrative circulars — clarifications on remittance purposes and rate applicability
Related Calculators
Methodology & Review
The TCS is the rate applied to the remittance amount above the annual threshold; the total is the remittance plus TCS. It models TCS on the portion exceeding the LRS threshold at a single rate and does not handle the lower rate for education/medical remittances or the threshold itself.
Updated