Master in Accounts & high court Advocate
9610 Points
Joined December 2011
Accounting for Private Remittance under LRS To record the private remittance under the Liberalized Remittance Scheme (LRS) in the books of accounts: -
*Separate accounting*: Maintain separate records for the private remittance, distinct from the company's transactions. -
*Documentation*: Ensure proper documentation, including proof of remittance and purpose of the remittance. -
*Accounting entry*: Record the remittance as a personal transaction of the director/promoter, rather than a company transaction.
Possible Accounting Entries - *Debit*: Director's/ Promoter's personal account (in the company's books) -
*Credit*: Bank account (for the remittance made)
Considerations -
*Compliance with RBI regulations*: Ensure compliance with RBI regulations regarding LRS and remittances. -
*Tax implications*: Consider tax implications for the director/promoter and the company.
- *Transparency and disclosure*: Maintain transparency and disclose the transaction in the company's financial statements, if required. Recommendations -
*Maintain records*: Maintain proper records and documentation to support the transaction. By following these guidelines, you can accurately record the private remittance in the books of accounts and ensure compliance with regulations.