RBI has made changes for liberalization and rationalization of LRS for resident individuals and existing guidelines issued under the Foreign Exchange Management (Current Account Transactions) Rules, 2000. The changes are as follows:-
- Authorized dealer Banks may allow remittances by a resident individual up to USD 250,000 per financial year for any permitted current or capital account transaction or a combination of both. If an individual has already remitted any amount under the LRS, then the applicable limit for such an individual would be reduced from the present limit of USD 250,000 for the financial year by the amount already remitted.
- To facilitate ease of transactions, all the facilities (including private/ business visits) for release of exchange/ remittances for current account transactions available to resident individuals under Para 1 of Schedule III to the Foreign Exchange Management (Current Account Transactions) Rules, 2000, as amended from time to time, shall now be subsumed under the overall limit of USD 250,000.
- However for the purpose of emigration, expenses in connection with medical treatment abroad and studies abroad, individuals may avail of exchange facility for any amount in excess of the overall limit prescribed under the LRS, if it is so required by a country of emigration, medical institute offering treatment or the university respectively.
- Gift in Indian Rupees by resident individuals to NRI relatives as defined in the Companies Act, 2013 shall also be subsumed under the LRS limit.
- The scheme cannot be made use for making remittances for any prohibited or illegal activities such as margin trading, lottery, etc.
- Persons other than individuals can make remittances for:-
- Donations for educational institutions
- Commissions to agents abroad for sale of residential flats/ commercial plots in India
- Remittances for consultancy services and
- Remittances for reimbursement of pre-incorporation expenses.
Details of the said circular can be viewed at
[Source: A.P. (DIR Series) Circular No.106 dated June 01, 2015]