GIFT TO NRI UNDER FEMA
This query is : Resolved
15 May 2024
Hello,
whether drawal of foreign exchange by resident Indian for remittance of gift $20000 to grand daughter(NRI) is allowed under LRS scheme of FEMA Act 1999?
Reply at earliest
whether drawal of foreign exchange by resident Indian for remittance of gift $20000 to grand daughter(NRI) is allowed under LRS scheme of FEMA Act 1999?
Reply at earliest
07 July 2024
Under the Liberalized Remittance Scheme (LRS) of FEMA (Foreign Exchange Management Act) 1999, resident Indians are permitted to remit money abroad for specific purposes, including gifts. Here's how it applies to your query:
1. **LRS Limit**: Currently, resident individuals can remit up to USD 250,000 per financial year under the LRS scheme for various permissible current and capital account transactions, including gifting.
2. **Gifts**: Gifts to NRI relatives are considered a permissible use under the LRS scheme, subject to certain conditions:
- The remittance can be made for gifting to a close relative (as defined in the Income Tax Act) who is an NRI (Non-Resident Indian).
- The maximum limit per financial year per individual under the LRS scheme applies (USD 250,000).
- The gift amount should comply with the norms and limits set under the scheme.
3. **Documentation**: For remittances under the LRS scheme, certain documentation may be required, such as a declaration form, KYC documents, and a purpose of remittance declaration.
Regarding your specific query about remitting $20,000 as a gift to your granddaughter (an NRI), this falls within the permissible limits of the LRS scheme, provided it adheres to the current annual limit of USD 250,000 and other regulatory requirements.
It's advisable to consult with a certified foreign exchange dealer or authorized bank dealing in foreign exchange transactions to ensure compliance with all relevant FEMA regulations and to facilitate the smooth processing of your remittance under the LRS scheme.
1. **LRS Limit**: Currently, resident individuals can remit up to USD 250,000 per financial year under the LRS scheme for various permissible current and capital account transactions, including gifting.
2. **Gifts**: Gifts to NRI relatives are considered a permissible use under the LRS scheme, subject to certain conditions:
- The remittance can be made for gifting to a close relative (as defined in the Income Tax Act) who is an NRI (Non-Resident Indian).
- The maximum limit per financial year per individual under the LRS scheme applies (USD 250,000).
- The gift amount should comply with the norms and limits set under the scheme.
3. **Documentation**: For remittances under the LRS scheme, certain documentation may be required, such as a declaration form, KYC documents, and a purpose of remittance declaration.
Regarding your specific query about remitting $20,000 as a gift to your granddaughter (an NRI), this falls within the permissible limits of the LRS scheme, provided it adheres to the current annual limit of USD 250,000 and other regulatory requirements.
It's advisable to consult with a certified foreign exchange dealer or authorized bank dealing in foreign exchange transactions to ensure compliance with all relevant FEMA regulations and to facilitate the smooth processing of your remittance under the LRS scheme.
You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now
Click here to login now
Similar Resolved Queries
Unanswered Queries
- CG Tax On residential property
- Post Office RD Interest
- Applicable TDS for Purchase of Flat from NRI
- Claiming exemption of perquisite for employee-owned car under New Tax Regime in ITR-2
- Eway bill for machinery reparing
- Gift of mutual fund units to daughter
- ITR 3 FILING OF AN INDIVIDUAL (PARTNER IN A PARTNERSHIP fIRM)
- Annual return of gst limit
- TDS ON CASH WITHDRAWALS...
- Not able to file ITR
- Building tax payment deduction in rental Income
- Foreign inward in ITR
- PF Taxable Income
- Clarification on Tax Audit Applicability and Reporting of F&O Transactions in ITR-3
- Interest credited in FY2025-2026 & TDS therein by EPFO does not reflect in AIS or Form 26AS
- 44ad eligble money lending interest
- Delisted shares sold in off market/ Rebate u/s87A
- In Exports Sales HSN details where to fill
- Opting out" of regime provided under subsection (1A) of Section 115BAC but Form 10IEA is not filed.
- Difference in tax comparison report
Trending Online Classes
-
DT & Audit (Exam Oriented Fastrack Batch) - For May 26 Exams and onwards Full English
CA Bhanwar Borana & CA Shubham Keswani
Subscribe to Pro
Join an elite circle of professionals
CAclubindia
