All About Liberalised Remittance Scheme-Part1

With globalisation, movement of funds between countries has become quite common. In this context it is quite important to take note of Liberalised Remittance Scheme in India.

Under this scheme a resident can remit upto USD 250000 for capital and current account transactions.

Who are Eligible to remit under this scheme

A resident Indian can only remit under this scheme. This scheme is not available to corporates, partnership firms, HUF, Trust etc

What kind of capital transactions are permissible under this transactions

• Opening of foreign currency account abroad with a bank
• Purchase of property abroad
• Making investments abroad acquisition and holding of shares of both listed and unlisted overseas companies
• Starting wholly owned subsidiaries and Joint Ventures
• Extending Loans to Non-Resident Indians

What is reporting Requirement

The individual will have to designate a branch of an Authorised Signatory through which all the remittances under the scheme will be made. The resident individual seeking to make the remittance should furnish Form a2 for purchase of foreign exchange under Liberalised Remittance Scheme