5% tax to be levied on foreign remittances from Oct 1

Any amount sent abroad to buy foreign tour packages will attract a 5% tax-collected-at source or TCS beginning October 1, unless tax is already deducted at source (TDS) on that amount. For other foreign remittances, the tax will kick in only for the amount spent above ₹7 lakh.

The tax will be 10% in case PAN or Aadhaar is not provided. The TCS will not be applicable if all arrangements of a foreign tour are made by oneself.

However, in case of education-related foreign remittances funded by loans, a TCS of 0.5% will be levied for an amount above ₹7 lakh.