At present, individuals making transactions through international credit cards while overseas will not attract TCS, the officials said.
“Transactions through international credit cards, while being overseas, would not be counted as LRS and hence would not be subject to TCS,” one of them said.
However, there are some technical nuances that need to be resolved before implementing the new LRS rules, which is why the government on Wednesday pushed the July 1 deadline to October 1, the officials added.
The applicable TCS rates on credit cards will be zero up to an expenditure of ₹7 lakh, beyond which it would attract 20%, the second official said. “The key difference here is only in the case of payments for overseas tour programmes. Such payments, by any mode, will attract 5% TCS till ₹7 lakh and 20% over ₹7 lakh,” the official added.
It is, however, not immediately clear whether the transactions carried out while abroad will be brought under the TCS net in future. “Expenditure through credit cards while overseas is not included in LRS as on date and will continue till a further decision on the matter. No date has been specified for this,” the second official said.
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