{"id":28570,"date":"2025-02-05T20:39:20","date_gmt":"2025-02-05T15:09:20","guid":{"rendered":"https:\/\/carajput.com\/blog\/?p=28570"},"modified":"2026-08-11T01:14:59","modified_gmt":"2026-08-10T19:44:59","slug":"budget-2025-impact-on-foreign-travel-remittances","status":"publish","type":"post","link":"https:\/\/carajput.com\/blog\/budget-2025-impact-on-foreign-travel-remittances\/","title":{"rendered":"Budget 2025: Impact on Foreign Travel &#038; Remittances"},"content":{"rendered":"<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_58 counter-hierarchy ez-toc-counter ez-toc-light-blue ez-toc-container-direction\">\n<p class=\"ez-toc-title\">Page Contents<\/p>\n<label for=\"ez-toc-cssicon-toggle-item-6a7e2e92990bc\" class=\"ez-toc-cssicon-toggle-label\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #000000;color:#000000\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #000000;color:#000000\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/label><input type=\"checkbox\"  id=\"ez-toc-cssicon-toggle-item-6a7e2e92990bc\"  aria-label=\"Toggle\" \/><nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/carajput.com\/blog\/budget-2025-impact-on-foreign-travel-remittances\/#Liberalized_Remittance_Scheme_LRS_TCS_Changes_in_Budget_2025\" title=\"Liberalized Remittance Scheme (LRS) &amp; TCS Changes in Budget 2025\">Liberalized Remittance Scheme (LRS) &amp; TCS Changes in Budget 2025<\/a><ul class='ez-toc-list-level-3'><li class='ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/carajput.com\/blog\/budget-2025-impact-on-foreign-travel-remittances\/#What_is_the_Liberalized_Remittance_Scheme\" title=\"What is the Liberalized Remittance Scheme?\">What is the Liberalized Remittance Scheme?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/carajput.com\/blog\/budget-2025-impact-on-foreign-travel-remittances\/#Key_Change_TCS_Threshold_Increase_in_Budget_2025\" title=\"Key Change: TCS Threshold Increase in Budget 2025\">Key Change: TCS Threshold Increase in Budget 2025<\/a><ul class='ez-toc-list-level-4'><li class='ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/carajput.com\/blog\/budget-2025-impact-on-foreign-travel-remittances\/#TCS_on_Foreign_Remittance_us_206C1G\" title=\"TCS on Foreign Remittance u\/s 206C(1G)\">TCS on Foreign Remittance u\/s 206C(1G)<\/a><\/li><\/ul><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-5\" href=\"https:\/\/carajput.com\/blog\/budget-2025-impact-on-foreign-travel-remittances\/#Key_Takeaways\" title=\"Key Takeaways\">Key Takeaways<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-6\" href=\"https:\/\/carajput.com\/blog\/budget-2025-impact-on-foreign-travel-remittances\/#Impact_on_Various_Sectors_Broader_Economic_Tourism_Benefits\" title=\"Impact on Various Sectors: Broader Economic &amp; Tourism Benefits \">Impact on Various Sectors: Broader Economic &amp; Tourism Benefits <\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-7\" href=\"https:\/\/carajput.com\/blog\/budget-2025-impact-on-foreign-travel-remittances\/#Conclusion\" title=\"Conclusion\">Conclusion<\/a><\/li><\/ul><\/li><\/ul><\/nav><\/div>\n<p><img loading=\"lazy\" decoding=\"async\" class=\" wp-image-9209\" src=\"https:\/\/carajput.com\/blog\/wp-content\/uploads\/2020\/10\/lrs.jpg\" alt=\"www.carajput.com; LRS\" width=\"885\" height=\"462\" srcset=\"https:\/\/carajput.com\/blog\/wp-content\/uploads\/2020\/10\/lrs.jpg 310w, https:\/\/carajput.com\/blog\/wp-content\/uploads\/2020\/10\/lrs-300x157.jpg 300w\" sizes=\"(max-width: 885px) 100vw, 885px\" \/><\/p>\n<h2><span class=\"ez-toc-section\" id=\"Liberalized_Remittance_Scheme_LRS_TCS_Changes_in_Budget_2025\"><\/span><span style=\"color: #000080;\">Liberalized Remittance Scheme (LRS) &amp; TCS Changes in Budget 2025<\/span><span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>The Union Budget 2025 has introduced key adjustments that affect how Indian residents remit money abroad, particularly benefiting travelers, students, and medical tourists. Here\u2019s what you need to know:<\/p>\n<h3><span class=\"ez-toc-section\" id=\"What_is_the_Liberalized_Remittance_Scheme\"><\/span><span style=\"color: #000080;\">What is the Liberalized Remittance Scheme?<\/span><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>Liberalized Remittance Scheme: A framework that allows resident individuals to remit money abroad for various purposes such as travel, education, and medical treatment, among others.<\/p>\n<h3><span class=\"ez-toc-section\" id=\"Key_Change_TCS_Threshold_Increase_in_Budget_2025\"><\/span><span style=\"color: #000080;\"><strong>Key Change: TCS Threshold Increase in Budget 2025<\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<div>\n<h4><span class=\"ez-toc-section\" id=\"TCS_on_Foreign_Remittance_us_206C1G\"><\/span><span style=\"color: #000080;\">TCS on Foreign Remittance u\/s 206C(1G)<\/span><span class=\"ez-toc-section-end\"><\/span><\/h4>\n<p>It compares the current limit\u00a0and proposed limit\u00a0for Tax Collected at Source (TCS) on various foreign remittances under the Liberalised Remittance Scheme (LRS).<\/p>\n<div class=\"___1dmoc29 f10pi13n ftgm304 f1enuhaj fdclmfp f1nbblvp fat0sn4 f1ov4xf1 fekwl8i f1lmfglv f1oz7aqm f1abmfm4 f1w619qj f16h0jq8\">\n<table class=\"___1vyiefv f1ddd56o f16vktn6 f1ahpp82 f11qra4b f1uinfot fibjyge fvueend f9yszdx f1fu4s3n f3l3pb3 f10ghnd0 f8fmt76 fjvbh62 f1qrqxae f1vw5qpk fc02sbz fxawf59 fymf513 f1aoyrul f1el8yx3 f1pymoxg f1ofu761 fe6itr f7coize f1794535 f1o0pw0q fbjjl9v fk1v6el f16pyhcb f1ixlhx9 f12zef0i flu5r5u f19haqzy f1owmcxx f1oddm8q f1004tna fcoaxci fh0ee9u f15v23i2 f1dmj53 f1r1gcv9 f14z1veh ffufd3x f1ypplot f1660cg\">\n<tbody>\n<tr>\n<th>Code<\/th>\n<th>Nature of Payment<\/th>\n<th>Current Limit<\/th>\n<th>Proposed Limit<\/th>\n<\/tr>\n<tr>\n<td>6CO<\/td>\n<td>Sale of Overseas Tour Program Package<\/td>\n<td>5% up to INR 7 lakh, 20% thereafter<\/td>\n<td>5% up to INR 10 lakh, 20% thereafter<\/td>\n<\/tr>\n<tr>\n<td>6CP<\/td>\n<td>Remittance under LRS for educational loan taken from financial institution covered under Section 80E<\/td>\n<td>Nil up to INR 7 lakh; 0.5% above INR 7 lakh<\/td>\n<td>NIL<\/td>\n<\/tr>\n<tr>\n<td>6CQ(a)<\/td>\n<td>Education and Medical Remittance under LRS<\/td>\n<td>Nil up to INR 7 lakh; 5% above INR 7 lakh<\/td>\n<td>Nil up to INR 10 lakh; 5% above INR 10 lakh<\/td>\n<\/tr>\n<tr>\n<td>6CQ(b)<\/td>\n<td>Other LRS Foreign Remittances<\/td>\n<td>Nil up to INR 7 lakh; 20% above INR 7 lakh<\/td>\n<td>Nil up to INR 10 lakh; 20% above INR 10 lakh<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/div>\n<h3><span class=\"ez-toc-section\" id=\"Key_Takeaways\"><\/span>Key Takeaways<span class=\"ez-toc-section-end\"><\/span><\/h3>\n<ul>\n<li>Threshold for most foreign remittances proposed to increase from INR 7 lakh to INR 10 lakh.<\/li>\n<li>Educational loan remittances from specified financial institutions proposed to be fully exempt from TCS.<\/li>\n<li>TCS rates remain unchanged in most cases; only the exemption threshold is proposed to be increased.<\/li>\n<li>Overseas tour packages continue to attract 5% TCS up to the threshold limit and 20% thereafter.<\/li>\n<\/ul>\n<\/div>\n<ul>\n<li>Previous Threshold: Tax collected at source of 5% was applicable on international remittances exceeding \u20b97 lakh.<\/li>\n<li>New TCS Threshold: The Tax Collected at Source threshold under the Liberalised Remittance Scheme has been increased from INR 700,000\/- to INR 1,000,000\/-. The threshold has been raised to INR 1,000,000\/-. This means that travellers, students, and medical patients can now remit amounts up to INR 1,000,000\/- without triggering the TCS, reducing their immediate tax burden on outbound remittances.<\/li>\n<li>If your international travel expenses exceed \u20b910 lakh in a financial year, Tax Collected at Source will be applicable. Tax Collected at Source Rate for Foreign Travel: 5% on the amount exceeding \u20b910 lakh.<\/li>\n<li>Other Remittances: For remittances (excluding education and medical expenses), Tax Collected at Source applies at 20% on amounts exceeding INR 700,000\/-<\/li>\n<\/ul>\n<h3><span class=\"ez-toc-section\" id=\"Impact_on_Various_Sectors_Broader_Economic_Tourism_Benefits\"><\/span><span style=\"color: #000080;\"><strong>Impact on Various Sectors: Broader Economic &amp; Tourism Benefits <\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<ul>\n<li>Boost to Tourism &amp; Forex Reserves: The budget also emphasizes enhancing tourism infrastructure and simplifying visa processes, which, in tandem with the higher TCS threshold, could lead to increased inbound tourism and improved forex inflows.<\/li>\n<li>Medical Tourism Growth: The government\u2019s initiatives, such as the &#8216;Heal in India&#8217; campaign, aim to further boost India\u2019s reputation as a top destination for affordable, high-quality medical care. This strategy involves public-private partnerships, enhanced infrastructure, and streamlined medical visa processes.<\/li>\n<\/ul>\n<ul>\n<li>For Indian Travelers\u2014Foreign Travel: International travel expenses are now more tax-efficient. TCS will only apply if travel expenses exceed INR 700,000\/- in a financial year, making outbound tourism more affordable for heavy spenders.<\/li>\n<li>For Students &amp; Medical Tourists: Education &amp; Medical Expenses: They benefit from a higher TCS exemption threshold, reducing upfront tax deductions on remittances for tuition fees or medical treatments abroad.<\/li>\n<\/ul>\n<ul>\n<li>For Indian Businesses: Overseas Payments: Businesses making payments for services or investments abroad can remit higher amounts before TCS is applied, aiding smoother international transactions.<\/li>\n<li>Economic Advantages &#8211; Increased Forex Inflows: More foreign tourists &amp; medical travellers will contribute to strengthening India\u2019s foreign exchange reserves. Growth in sectors like healthcare, tourism, and hospitality will create more job opportunities. Indian companies are expected to attract more global investments and partnerships due to these positive reforms.<\/li>\n<\/ul>\n<h3><span class=\"ez-toc-section\" id=\"Conclusion\"><\/span><span style=\"color: #000080;\"><strong>Conclusion<\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>Those planning to spend heavily on overseas trips will face higher upfront costs due to the collection of tax collected at source on larger amounts. The increase in the TCS threshold under LRS\u2014from INR 700,000\/- to INR 1,000,000\/-\u2014offers immediate tax relief for outbound remittances related to travel, education, and medical expenses. This measure, alongside other tourism and healthcare initiatives in Budget 2025, is set to make international engagements more accessible for Indian citizens while bolstering the country\u2019s overall economic and forex position.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Liberalized Remittance Scheme (LRS) &amp; TCS Changes in Budget 2025 The Union Budget 2025 has introduced key adjustments that affect how Indian residents remit money abroad, particularly benefiting travelers, students, and medical tourists. Here\u2019s what you need to know: What is the Liberalized Remittance Scheme? Liberalized Remittance Scheme: A framework that allows resident individuals to &hellip;<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[15],"tags":[10310],"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/posts\/28570"}],"collection":[{"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/comments?post=28570"}],"version-history":[{"count":4,"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/posts\/28570\/revisions"}],"predecessor-version":[{"id":32778,"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/posts\/28570\/revisions\/32778"}],"wp:attachment":[{"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/media?parent=28570"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/categories?post=28570"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/tags?post=28570"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}