Under this rule, a 20% TCS will be levied on all remittances abroad, including investments in foreign stocks, mutual funds, cryptocurrency, and property. Additionally, if you are investing in a domestic mutual fund, and having exposure to foreign stocks, the same will not be considered as a foreign remittance under LRS and thus will not attract TCS.
TCS is an extra amount that is collected by a seller as a tax on specified goods from buyers at the time of sale over and above the sale amount and is remitted to the government account.
When investing in foreign assets, such as foreign stocks, and transferring money abroad for these investments, your bank or financial institution may collect TCS on the amount exceeding the specified threshold ( Rs 7 lakh), subject to fluctuating rates and thresholds that can change over time.