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Feb 17, 2025
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Foreign education loans gets full relief from TCS on tuition fee remittances
The Union Budget 2025-26 has introduced major changes to Tax Collected at Source (TCS), offering relief to Indian students aspiring to study abroad. These revisions aim to reduce the financial burden on families by lowering tax implications on foreign remittances under the Liberalised Remittance Scheme (LRS). Under this scheme, authorized dealers collect TCS when individuals transfer funds abroad. However, TCS is not an additional tax but an advance that can be adjusted against total income tax liability or refunded if overpaid.
How This Benefits Students and Parents
Education loan borrowers get full relief from TCS on tuition fee remittances, reducing financial burden.
Families remitting personal savings still face 5% TCS on amounts exceeding Rs 7 lakh, but this is significantly lower than the 20% imposed on general remittances.
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