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Understanding the Tax Collected at Source (TCS) on foreign remittances for education is crucial for Indian students planning to study abroad. As of October 1, 2023, the TCS rate for sending money abroad has been significantly revised under the Liberalised Remittance Scheme (LRS).
For educational purposes, remittances below INR 7 lakhs are exempt from TCS. For amounts equal to or exceeding INR 7 lakhs, the TCS rate varies: if the funds are sourced from an educational loan, a lower rate of 0.5% applies; without a loan, the rate is 5%. This policy aims to ease the financial burden on students while ensuring compliance with tax regulations.
For educational purposes, remittances below INR 7 lakhs are exempt from TCS. For amounts equal to or exceeding INR 7 lakhs, the TCS rate varies: if the funds are sourced from an educational loan, a lower rate of 0.5% applies; without a loan, the rate is 5%. This policy aims to ease the financial burden on students while ensuring compliance with tax regulations.