Master Your LRS Quota
- $250,000 per person per financial year (April 1 - March 31). Resets annually.
- Cumulative across all purposes: Travel, education, investments, gifts all count toward same limit.
- Family pooling legal: Spouse/relatives each get $250K. A family of 4 can send $1M/year legitimately.
- Profits don't count: Send $100K, grow it to $500K—only $100K counts. Keep profits abroad or repatriate freely.
- Bank tracks via PAN: All remittances linked to your PAN. Can't bypass using multiple accounts.
- TCS on >â‚ą7L: 20% TCS on overseas investment remittances above â‚ą7 lakh. Refundable via ITR.
Breaking Down the $250K Limit
India's Liberalized Remittance Scheme (LRS) allows any resident individual to remit up to $250,000 per financial year (April 1 to March 31) without RBI approval.
What Counts Toward Your Limit
| Purpose | Counts? | Notes |
|---|---|---|
| US stock purchases | âś… Yes | Full amount remitted counts |
| Real estate abroad | âś… Yes | Property purchases included |
| Education/tuition | âś… Yes | Shares same $250K pool |
| Medical treatment abroad | âś… Yes | Emergency or planned |
| Gifts to relatives abroad | âś… Yes | Within limits |
| Investment profits | ❌ No | Only principal remitted counts |
| Bringing money back to India | ❌ No | Repatriation unlimited |
| Currency fluctuations | ❌ No | Based on INR amount sent |
Real Example: Using Your Full Quota
April 2025: â‚ą41 lakh ($50K) to Vested for Nvidia stock
June 2025: â‚ą82 lakh ($100K) for child's US university tuition
October 2025: â‚ą41 lakh ($50K) for vacation property in Thailand
February 2026: â‚ą41 lakh ($50K) more US stocks
Total used: $250K. Limit exhausted. April 2026: Fresh $250K available.
The Annual Reset: Timing Strategy
LRS limit resets on April 1 each year. Smart investors use this:
March Strategy
Send $249K in late March (FY 2025-26). Send another $249K in early April (FY 2026-27). You've deployed ~$500K in 2 weeks, legally.
Avoid TCS Twice
Send â‚ą6.9 lakh in March (under â‚ą7L threshold, zero TCS). Send â‚ą6.9 lakh in April. Total â‚ą13.8L invested, zero TCS paid.
Contrarian Take
Everyone's worried about Meta's metaverse spending. They should be. But what they miss is that Meta's AI advertising engine is so far ahead, they can burn $10B yearly on moonshots and still dominate.
Family Quota Pooling: $1M+ Legitimately
Each individual Indian resident gets $250K/year. This means:
You + Spouse
$500K/year combined. Both open brokerage accounts, each invests their own $250K quota. Completely legal.
Family of 4
Parents + 2 adult children (18+) = $1 million annual quota. Each invests individually under their PAN.
Extended Family
Parents, siblings (if residents), grandparents—all eligible. A large family can move millions legally.
The Golden Rule: Must Be Genuine
Each person must invest for themselves—not as a pass-through for you. RBI/IT department can scrutinize:
- Is your spouse employed? Can they genuinely afford $250K investment?
- Are stock purchases held long-term or immediately transferred?
- Does each person file their own ITR declaring foreign assets?
Legal: You and spouse each invest $250K in your own names, for your own
accounts.
Illegal: Your spouse "lends" their quota so you effectively send
$500K under your control.
Practical Family Pooling Strategy
Scenario: You want to invest â‚ą1 crore ($120K) in US stocks, but you're conservative about using your full quota.
Solution:
- You: Send â‚ą60 lakh ($72K). Buy Nvidia, Tesla in your Vested account.
- Spouse: Sends â‚ą40 lakh ($48K). Opens separate Vested account, buys Microsoft, Apple.
- Total family exposure: â‚ą1 crore. Both accounts in respective names. Both file ITR separately declaring foreign assets.
How to Track Your LRS Usage
Unlike a bank account with a running balance, LRS doesn't have a real-time tracker. Here's how to monitor:
Method 1: Bank Statements
Each outward remittance is recorded in your bank statement. Tag as "LRS" and sum up. Most banks also show "Total LRS used FY 2025-26" on A2 forms.
Method 2: Ask Your Bank
Call relationship manager: "What's my total LRS usage this FY?" They have it in their system (linked via PAN).
Method 3: Manual Excel Tracker
Create a simple spreadsheet:
| Date | Purpose | INR Amount | USD Amount | Remaining |
|---|---|---|---|---|
| Apr 15, 2025 | US stocks (Vested) | â‚ą41L | $50K | $200K |
| Jul 10, 2025 | Education | â‚ą82L | $100K | $100K |
| Dec 20, 2025 | US stocks (Vested) | â‚ą82L | $100K | $0 |
Common Tracking Mistakes
- Forgetting currency fluctuations: You sent â‚ą20L when USD was â‚ą82. That's $24.4K, not based on current rate.
- Including repatriated profits: You brought back $50K profit from US stocks—doesn't reduce your fresh quota.
- Mixing fiscal years: $100K in March FY25 + $150K in April FY26 = you're within limits both years.
Advanced LRS Optimization Strategies
Strategy 1: Stagger Across Years
Goal: Invest â‚ą2 crore over time.
Execution: â‚ą1 crore in
FY25, â‚ą1 crore in FY26. Avoids exceeding limit, spreads currency risk.
Strategy 2: Keep Profits Abroad
Send $100K: Invest in Tesla/Nvidia. It grows to $400K. Don't bring $400K back—only $100K counted against LRS. Keep $400K reinvesting in US markets indefinitely.
Strategy 3: â‚ą7 Lakh TCS Arbitrage
Problem: Need to send â‚ą20L ($24K).
Option A: Send all
at once → ₹2.6L TCS collected (refundable but cash blocked 6-12 months).
Option
B: â‚ą6.9L in Feb, â‚ą6.9L in Apr, â‚ą6.2L in Jul = Zero TCS collected.
Strategy 4: Use Peak INR Weakness
When USD = â‚ą85 (strong USD), â‚ą21L = $247K. When USD = â‚ą80 (weak USD), â‚ą20L = $250K. Maximize dollar remittance during rupee weakness.
Strategy 5: Gift to Children's Accounts
If you have adult children (18+), gift them ₹2L. They open their own Vested account, remit under their LRS, invest. You effectively control via guidance, they own legally. Gray area—consult CA.
What NOT to Do
- Structuring: Breaking $300K into 2 years solely to evade scrutiny (not genuine spreading)—illegal.
- False declarations: Claiming "education" purpose when it's actually investment—FEMA violation.
- Using others' quotas: Borrowing a friend's PAN to send money—100% illegal, jail-worthy offense.
- Hawala/crypto bypasses: Bypassing banking system to avoid LRS tracking—money laundering, serious crime.
LRS FAQs
Q: What if I exceed $250K by mistake?
A: Banks usually block the transaction if you've exceeded. If it somehow goes through, contact RBI immediately to self-report. Penalty: up to 3x the excess amount. Rectify fast to minimize damage.
Q: Can I carry forward unused quota?
A: No. If you use $150K in FY25, the $100K unused is lost. It doesn't roll over to FY26.
Q: Do NRIs have LRS limits?
A: No. NRIs don't fall under LRS. They can invest in US stocks directly via US brokers without limits. Simpler for them.
Q: Can I use LRS for cryptocurrency?
A: Gray area. RBI hasn't explicitly allowed crypto under LRS. Some banks reject such remittances. High risk—avoid unless regulations clarify.
Q: If I bring profits back, does it restore my quota?
A: No. LRS only limits outward remittances. Bringing money back (inward) doesn't affect or restore your $250K quota.
Master LRS, Maximize Global Wealth
$250K per year is more than enough for most retail investors. Add family quotas, and you can deploy millions. The key is strategic planning, tax optimization, and full compliance.
Use every dollar of your LRS quota. Build global wealth. Stay legal.