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Liberalised Remittance Scheme of USD 200,000

Shridhi Jain (Company Secretary) (1678 Points)

21 May 2011

Dear members,

I have following queries regarding LRS Scheme (Liberalised Remittance Scheme of USD 200,000), kindly reply :

What is the procedure to purchase the shares of a company in Singapore ?

As per FEMA, an individual is permitted (automatic route), to invest USD 200,000 without obtaining prior approval from RBI. Does he need to give details of investment and income generated thru that investment that he has done abroad in India (in IT return or anywhere else) ?

Whether the individual is required to maintain any details in India with any authority for the investment made abroad and income generated thru that investment ?

Is foreign income is taxable in India even if it is not brought in India ?

Kindly reply....

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4 Replies

Archana (Company Secretary) (165 Points)
Replied 23 May 2011

Dear Shridhi,

Under LRS, an individual is permitted to invest upto USD 200,000 without taking approval from RBI but that doesnt mean he is unrestrained from intimating to RBI. He has to intimate and give all the details of investment to RBI. However, if you are routing your investment transaction through authorised dealer, the concerned bank i.e AD will guide you through the procedure and will intimate to RBI on your behalf.

Other views welcomed.

Thnx

Archana

1 Like

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Shridhi Jain (Company Secretary) (1678 Points)
Replied 30 May 2011

Hey thanks, Archana.

I know that the investor has to inform the AD about the investment, who will forward the investment information to RBI.

But besides that, do anybody need to inform to any of the government authorities in any way ?

Like do the investor has to give detail of investment in ITR ? or do the investor need to give details of investment to RBI, AD etc. on regular basis ?

One more thing, income from that investment is taxable in India, so do we need to give full details of the investment and income generated from that investment ?

Archana (Company Secretary) (165 Points)
Replied 30 May 2011

Dear Shridhi

No intimations to any one except RBI and tht also AD will ask u wenevr anything is required from ur side whter periodically or on regular basis.they r specialised persons in dis and are accountable for returs to rbi.

yes ur details about investment & income should be reflected in annual accounts.

thnx

1 Like

CA. Anuj Gupta (Practices in NRI Int.Tax FEMA TP FDI/FIPB & FCRA) (7024 Points)
Replied 16 July 2011

Originally posted by : Shridhi Jain
	Hey thanks, Archana. I know that the investor has to inform the AD about the investment, who will forward the investment information to RBI. But besides that, do anybody need to inform to any of the government authorities in any way ? Like do the investor has to give detail of investment in ITR ? or do the investor need to give details of investment to RBI, AD etc. on regular basis ? One more thing, income from that investment is taxable in India, so do we need to give full details of the investment and income generated from that investment ?