An overview of overseas investment and of money sent abroad by individuals. General legal information only.
Overseas investment by businesses
Indian entities can invest in foreign entities under the overseas investment rules, either as overseas direct investment or as portfolio investment, subject to the conditions, limits and reporting. A financial commitment limit linked to net worth generally applies. Certain sectors and structures are restricted, and some investments need prior approval.
Reporting
- Report the investment through the authorised dealer bank in the prescribed form and time.
- File annual performance reports for the overseas entity.
- Keep the share certificates and valuation records.
Individuals: Liberalised Remittance Scheme
Resident individuals can remit up to a set annual limit per financial year for permitted purposes such as education, travel, gifts and investments abroad. The limit and permitted uses are set by the RBI and the rules, so check the current figures. Tax collected at source applies on some remittances.
What is not permitted
The scheme is not available for certain purposes, such as remittances to restricted countries or for prohibited activities.
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Important disclaimer: This article is general legal information, not legal advice. It does not create a lawyer-client relationship and is not an advertisement or solicitation under Bar Council of India rules. Verify current statutes, rules and judgments before relying on it.
