How much money can parents send to their kids abroad?
If your kids studying or working abroad need money, how much can you transfer them at one go?
Under the Foreign Exchange Management Act (FEMA) provisions, an Indian citizen can remit up to $250,000 (around ₹1.86 crore at present) in a financial year for specified transactions.
Permissible transactions include the opening of a foreign currency account abroad with a bank. You can also use the limit for the purchase of property abroad.
Investors can use it for purchasing stocks, mutual funds, debt instruments, or investing in private equities, and so on. An individual can use this limit for personal or business visits or when emigrating to another country. It’s also applicable for gifts and donations.
Within the specified limit, Indian citizens can also send money to maintain close relatives, medical treatment, and education.
Therefore, you can send up to $250,000 to your children abroad freely under the Liberalised Remittance Scheme of the Reserve Bank of India.
However, you could face some restrictions on the amount you want to transfer depending on the mode of remittance. For example, if you are doing an online transfer – via internet banking or online services – many banks and agents have a cap of $25,000 for each transaction.
Some banks could even have restrictions on the daily transfer amount that their customers can do online.
If you want to transfer over $25,000 to your close relatives abroad, you will need to visit a bank’s branch. It will require you to complete some paperwork, including filling up the outward remittance form and attaching supporting documents.
Therefore, before opting for outward remittance, make sure you know the transaction limits your bank or agent has on outward remittances.
(Do you have personal finance queries? Send them to [email protected] and get them answered by industry experts)
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