Tax Collected at Source (TCS) is collected when an individual's foreign exchange under LRS crosses ₹10 lakh in a financial year. From 1 April 2026 it is levied under section 394 of the Income-tax Act, 2025.
| Purpose | Up to ₹10 lakh | Above ₹10 lakh |
|---|---|---|
| Education paid from an eligible education loan | Nil | Nil |
| Education or medical treatment from own funds | Nil | 2% |
| Overseas tour package | 2% of the package value | |
| Travel forex (notes, travel card) and other purposes | Nil | 20% |
It is not a cost
TCS is credited against your PAN. It appears in your annual tax statement and you adjust it against your income tax, or claim a refund, when you file your return.
Business travel paid by a company
Forex for an employee's business trip, paid by the company from its own account, is not the employee's LRS drawal, so TCS does not apply.
Our TCS calculator works out the amount before you pay.