Rohit, a resident individual in India, remitted USD 1,80,000 in June 2025 towards his daughter's tuition fees in Canada under the Liberalised Remittance Scheme (LRS). In September 2025, he remitted USD 40,000 towards mai

Under the Liberalised Remittance Scheme (LRS), Authorised Dealers may freely allow remittances by resident individuals up to USD 2,50,000 per Financial Year (April-March) for any permitted current or capital account transaction or a combination of both. The limit of USD 2,50,000 per Financial Year (FY) under the Scheme also includes/subsumes remittances for current account transactions (viz. private visit; gift/donation; going abroad on employment; emigration; maintenance of relatives abroad; business trip; medical treatment abroad; studies abroad) available to resident individuals. Release of foreign exchange exceeding USD 2,50,000, requires prior permission from the Reserve Bank of India. In the present case, Rohit has already remitted USD 1,80,000 towards tuition fees and USD 40,000 towards maintenance of his son abroad, making a total remittance of USD 2,20,000 during the Financial Year. Therefore, the remaining balance available to him under the LRS is USD 30,000 out of the prescribed limit of USD 2,50,000. If Rohit now remits USD 60,000 as a gift, his total remittances for the Financial Year would amount to USD 2,80,000, which exceeds the permissible limit of USD 2,50,000 under the Scheme. The scheme specifically provides that release of foreign exchange exceeding USD 2,50,000 requires prior permission of the Reserve Bank of India. Rohit's contention that each category has a separate limit is incorrect. The limit is aggregate per Financial Year, irrespective of the number or nature of transactions, whether current account or capital account, or a combination thereof. Therefore, the Authorised Dealer bank is correct in refusing to process the remittance of USD 60,000 without prior approval of the RBI. Rohit may remit only USD 30,000 within the LRS limit during the relevant Financial Year, and for any amount exceeding that, he must obtain prior permission from the Reserve Bank of India.