* The LRS limit is per individual. So, a resident Indian couple can invest up to USD 5,00,000 abroad.
Investing internationally through the LRS allows you to add global exposure to your portfolio and diversify your country-specific and currency risk.
Diversification: As we already mentioned, the LRS allows you to diversify your portfolio beyond India.
Plan for future expenses and investments: You can start building your international portfolio to fund your children’s international education or international property purchase later. That way, you are not bound by the annual $250,000 limit since you already have investments abroad that you can liquidate.
Foreign currency transactions can be complex exercises. Our relationship managers will work with you and guide you on how to make the most of the LRS scheme based on your financial needs and goals.
FACTBOX
The Liberalised Remittance Scheme (LRS) facilitates Indian residents (minors included) to remit funds outside India up to USD 250,000 or an equivalent value in any freely convertible foreign denomination in a financial year. This is a measure created for any permissible capital account transaction, current account transaction, or a combination of the two.
All resident Indians including minors are eligible under the said scheme. Corporates, partnership firms, LLPs, HUFs. and trusts cannot use LRS to remit money abroad.
The following are prohibited under LRS:
- Capital account transactions made directly or indirectly to non-cooperative countries or territories.
- Current account transactions banned by Schedule I or restricted under Schedule II of the Foreign Exchange Management (Current Account Transactions) Rules, 2000
- Other prohibitions in remittances that arise out of overseas exchanges, counterparties, secondary markets, or individuals/ organizations supporting acts of terrorism.
You can remit money abroad for travel, children’s education, investments, emigration, gift or donation, care of relatives abroad etc.
The remitted amount can be invested in:
- Shares and debt instruments
- Immovable properties in the overseas market
- Open, hold and maintain foreign currency accounts with banks outside India to make transactions permitted under the LRS.
An individual can remit up to USD 250,000 per financial year under the LRS.
