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Anil

Anil Rego  |346 Answers  |Ask -

Financial Planner - Answered on Dec 10, 2021

Anil Rego is the founder of Right Horizons, a financial and wealth management firm. He has 20 years of experience in the field of personal finance.
He’s an expert in income tax and wealth management.
He has completed his CFA/MBA from the ICFAI Business School.... more
Murali Question by Murali on Dec 10, 2021Hindi
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Hope your team is safe and well.

It's wonderful that you all are providing not only news but beneficial interface to the Rediff audience with experts from different facets of life.

I have some queries for Mr Anil.

1. I understand that any remittance, including tuition fees payments, to foreign countries from India should be within Rs 7 lakh and once it crosses this limit, then the excess amount will be taxed at 5 per cent as TCS. Am I right?

2. Also, I understand if the same tuition fee is paid from a student loan taken, then it will be taxed at 0.5 per cent as TCS. Am I right?

3. Finally, can each earning and income tax paying parent pay half of the international university fees for their child from their individual accounts, so that both stay within Rs 7 lakhs limit of foreign remittance allowed tax free?

Hope you can guide us and help. This will be really useful for us to plan.

Thank you in advance for your help.

Ans: Going pointwise...

1. Yes, you are right.

In case Aadhar or PAN is missing, the TCS would be 10 per cent.

I would like to add that it is only Tax Collected At Source and it is not tax in itself.

You can set off this TCS for your tax liability from your other sources of income.

2. Yes, this is right. It can go up to 5 per cent, if PAN is not provided.

3. Yes, TCS is applicable at a PAN level. So, you can transfer up to Rs 7 lakhs each without TCS being applicable.

 

DISCLAIMER: The content of this post by the expert is the personal view of the rediffGURU. Users are advised to pursue the information provided by the rediffGURU only as a source of information to be as a point of reference and to rely on their own judgement when making a decision.
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