How to get 5% TCS for remittances beyond ₹7 lakh

livemint.com:

₹7 lakh per annum for TCS on all categories of LRS payments, through all modes of payment, and for all purposes, has been restored. The Central Board of Direct Taxes (CBDT) has issued some important guidelines on the implementation of changes relating to TCS under the LRS and for overseas tour packages. The restoration of the exemption limit is indeed a very positive move and removes the undesirable differential treatment for different purposes and modes of remittances.

The CBDT circular has clarified that such a limit will apply to an individual remitter and not the authorized dealer. Also, this limit will apply on collective basis for all LRS remittances of such individual, aggregated in a year and not separately for each purpose. The circular also clarifies that the authorized dealer may rely upon the undertaking from the remitter, at the time of remittance, detailing the amount and nature of earlier LRS remittances made by the remitter in the same year, through other authorized dealers.

Any false information by the remitters may attract appropriate action against them under the Act. In accounting parlance, the first-in first-out (FIFO) method will be applicable for determining the applicable TCS rate, in cases where remittances under the liberalized scheme are made at different points of time in a year. The remittances triggering the breach of the threshold exemption limit will determine the applicable TCS rate.