New TCS rule on foreign remittance to come into effect from October 1, says Centre

By India Today Business Desk: The Finance ministry in a notification announced that the new Tax Collection at Source (TCS) rates which were to come into effect from July will now come into effect from October 1.

“The increase in TCS rates, which were to come into effect from July 1, 2023 shall now come into effect from October 1, 2023,” the ministry said, adding till September 30, rates prior to the amendment by the Finance Act 2023 will continue to apply.

There will be no change in the rate of TCS for all purposes under LRS and for overseas travel tour packages, regardless of mode of payment, for amounts up to Rs 7 lakh per individual per annum, the notification read.

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It is to be noted that the government had raised TCS on foreign remittance through the Liberalised Remittance Scheme (LRS) to 20 per cent from the existing 5 per cent, except in certain cases in its last Budget. The higher rate of TCS was about to kick in from July 1, 2023.