1. What is an Outward Remittance? An Outward Remittance is a transfer of money in foreign exchange, by a resident in India or an NRI to a beneficiary situated within or outside the country (except for Nepal and Bhutan) for a purpose as approved under FEMA (Foreign Exchange Management Act). You may send money abroad to a beneficiary for various purposes including education, employment abroad, emigration, maintenance of close relatives, foreign travel, gifts, medical treatment, donations, etc.
2. Who is eligible to do an Outward Remittance? Account holders in a Bank (resident and non-resident) as well as non-account holders can do an Outward Remittance transaction.
3. Can non-account holders of a Bank make an outward remittance through a Bank? What are the requirements for making such remittance? Yes, resident non account holders can make an outward remittance through Bank. Non-account holders are required to provide their identity and residence proof at the time of placing the request for outward remittance. The payment for the remittance may be made by account payee cheque or Demand Draft or by Cash deposit (upto Rs. 50,000/-). The payment can also be made through NEFT or RTGS,. However, non-account holders may not make remittances under the "Liberalised Remittance Scheme". NRI's who do not hold an account with any Bank cannot make remittances through Bank.
4. Can the joint account holder do an outward remittance out of the resident savings bank account? In case of resident savings accounts, the request needs to be given by either/both the account holders depending upon the mode of operation of the account. In case the main holder becomes a Non Resident, the remittance can only be initiated post re-designating the account as an NRO account. However, if the second or subsequent holder becomes a non-resident, his name should be removed from the account and thereafter the remittance can be effected.
5. What are the modes of doing an outward remittance? Money can be sent abroad through the following modes: • Wire Transfer • Foreign Currency Demand Draft
7. What is the process to do an outward remittance? You can do an outward remittance by visiting any of the your Bank & submit forms/docoments with necessary beneficiary and transaction details. OR The customer having internet banking account, can do an outward remittance through online channel as well.
8. To whom can you remit for the purpose of "maintenance of close relatives"? You can remit to the below mentioned persons: (a) Members of your Hindu undivided family; or (b) Your spouse (c) You are related to the beneficiary in any of the manners indicated below: 1. Father (including step-father) 2. Mother (including step-mother) 3. Son (including step-son) 4. Son's wife 5. Daughter 6. Daughter's husband 7. Brother (including step-brother) 8. Sister (including step-sister)
9. Can I remit funds for acquisition of shares in a company abroad? A resident individual may make a remittance under the Liberalized Remittance Scheme for resident individuals upto USD 125,000 (for details refer to Q.12 below) for acquisition of shares (of listed or otherwise) or debt instruments in a company abroad. In addition to the above , as per relevant guidelines, a person resident in India: • May purchase a foreign security out of the funds held in RFC account maintained in accordance with Foreign Exchange • Management (Foreign Currency accounts by Person Resident in India) Regulations, 2000; • May acquire bonus shares on the foreign securities held in accordance with the provisions of the FEMA or rules or regulations made there under; • When not permanently resident in India, may purchase a foreign security from out of his foreign currency resources outside India;
10. What is the limit for making a remittance for the purpose of medical treatment abroad? The limit to remit for the purpose of Medical expense is USD 100,000. Remittance in excess of USD 100,000 is allowed without any monetary limit subject to estimate from doctor in India or a doctor/hospital abroad. Reserve Bank approval is required to release exchange if the amount exceeds the estimate from the doctor in India or doctor/hospital abroad.
11. Can I take an Insurance policy from a Foreign Insurance Company? A person resident in India can take a life insurance policy by an insurer abroad, with no specific monetary limit, only if the policy is held under the specific or general permission of the Reserve Bank of India. In case of a general insurance policy, the same needs to be held under the general or specific permission of the Central Government. However, remittance towards premium for Health Insurance policies may be availed of from companies abroad.
12. What is the Liberalised Remittances Scheme? Who is eligible to avail the facility under this scheme? The Liberalised Remittance Scheme is a facility available for making remittance up to USD 125,000 per financial year for permissible current or capital account transactions or a combination of both. All resident individuals are eligible to avail of the facility under the Liberalised Remittance Scheme. However it is mandatory to have a PAN number to make a remittance under this scheme, and your account with a Bank must be at least 1 year old. This facility will not be available to corporate, partnership firms, HUF, Trusts, etc. Also, remittance cannot be done from any loan/overdraft account. PAN details are mandatory to send funds under the said scheme.
13. What are the purposes for which remittance can be made under the Liberalised Remittance Scheme? This facility is available for making remittances for any permissible current or capital account transactions or combination of both. Under this facility, resident individuals can freely acquire and hold, shares or any other asset outside India without prior approval of Reserve Bank of India. Scheme is not available for purposes specifically prohibited (Schedule I) or regulated by the Government of India (Schedule II) of Foreign Exchange Management (Current Account Transactions) Rules, 2000. Scheme is also not permitted for remittance being made directly or indirectly to Nepal, Bhutan, Mauritius or Bhutan or to any country identified as a non-co-operative country by the Financial Action Task Force (http://www.fatf-gafi.org). Further, remittance for any payments in the nature of margin calls including for trading in foreign exchange are not permitted.
14. What are Small Value Remittances and what are the purposes for which remittances can be sent as Small Value Remittances"? Small Value Remittances can be made up to USD 25000 per financial year, for any permissible current account non-trade transaction on the basis of Retail Outward Remittance Application. Where the remittance is for payment towards purchase of goods for personal use/subscription fees or charges etc. please provide documentary proof of the transactions such as an Invoice or Debit note. The Invoice/Debit note must be in the name of the account-holder from whose account the remittance is being made.
15. What is the procedure for making a remittance for any services availed from abroad? In case of remittances for any services availed from abroad such as consultancy charges/legal fees/training fees etc., in addition to the documents as specified from Small Value Remittances, please furnish a Certificate from a Chartered Accountant in Form 15CA and 15CB stating that tax u/s 195 has been deducted from the payment (Please refer to the question "What is the process for obtaining C.A. Certificate?" below)
16. When is the C.A. Certificate required for initiating outward remittance? Based on the Reserve Bank of India guidelines, a certificate in prescribed forms (15CA & 15CB) need to be produced while making remittances for certain types of transactions which are not covered by the Liberalised Remittance Scheme or Small Value Remittances. Please consult your local ABank Branch for details if your transaction does not appear to fall under any of these categories. The certificate is also required for all remittances from NRO account and for foreign nationals seeking repatriation. The formats and submission details are available at the website of the Income Tax Department.
17. What is the process for obtaining C.A. Certificate? Form 15 CB needs to be certified by a Chartered Accountant. Form 15 CA has to be filled in online at the website of the Income Tax Department. The printout generated from this site has to then be signed by the remitter and submitted along with Form 15CB at the branch from where the remittance is being made.
The detailed process of filling up the form is also available at the Income Tax Department website. The filled up form then needs to be produced along with the 15 CB to the branch.
18. How much foreign exchange can a person send as gift or donation to a person resident outside India ? If you are eligible for the Liberalised Remittance Scheme, you may send upto USD 125,000 as a gift to any person resident outside India or as a donation to any charitable/educational/religious/cultural organisation outside India. This remittance can be done only under the LRS and is meant for individuals only. Entities other than individuals may send donations upto USD 5,000 or equivalent only.
19. What is the USD 100,000 scheme? Who is eligible to avail the facility under this scheme? The USD 100,000 Scheme is a facility available for making remittance up to USD 100,000 per financial year for below mentioned specific purposes on the basis of Retail Outward Remittance Application: Education abroad Employment abroad Emigration Maintenance of close relatives Medical treatment abroad All resident individuals are eligible to avail of the facility. This facility will not be available to corporate, partnership firms, HUF, Trusts, etc.