TCS on Remittance: Foreign Transfer Tax Calculation 2026
Sending Money Abroad? TCS Applies
Tax Collected at Source (TCS) applies when you remit money outside India under the Liberalized Remittance Scheme (LRS). The bank collects TCS upfront and deposits it with the government. You can claim it as a credit when filing your ITR.
TCS Rates on Foreign Remittance (FY 2025-26)
| Purpose | Up to ₹7 lakh | Above ₹7 lakh |
|---|---|---|
| Education (with loan) | Nil | 0.5% |
| Education (without loan) | Nil | 5% |
| Medical treatment | Nil | 5% |
| Foreign tour packages | 5% | 20% |
| Other remittances (investment, gifts) | Nil | 20% |
How to Claim TCS Refund
- TCS appears in Form 26AS and AIS
- Claim it as tax credit while filing ITR (like TDS)
- If TCS exceeds your tax liability, you get a refund
Example: Sending ₹15 lakh for child’s college abroad (no loan): TCS = 5% × (₹15L – ₹7L) = ₹40,000. This is not a tax — it’s an advance payment adjustable against your income tax.
Calculate your TCS liability with the TCS calculator. For education loan tax benefits, see education loan guide.