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My husband is an NRI living in the UAE. He has transferred money to my savings account in India several times, with amounts ranging from Rs. 70,000 to Rs. 250,000 per transaction. There have been around 6 such transactions so far.
Each time my husband transfers money, I receive an email from my bank mentioning TCS (Tax Collected at Source). My understanding is that TCS is applicable on income but in my case, this is not an income – it is simply a transfer to a spouse’s account.
I wanted to check if TCS is applicable in my case, considering this money is not an income but a fund transfer between spouse accounts. I would appreciate any clarification on whether TCS deductions by the bank are relevant here.
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Demystifying TCS and Its Relevance
Up0Firstly, let me assure you that there’s no immediate reason for concern. Tax Collected at Source, commonly known as TCS, is generally more relevant to funds being sent out of India rather than incoming transfers.
The emails you’ve been receiving are likely automated notifications triggered by foreign currency transactions. I’d highly recommend discussing this with your bank’s branch manager for personalized clarification. It’s always good to confirm so you can have peace of mind.
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Up0
You might consider opening a Non-Resident External (NRE) account in your husband’s name for a more straightforward and tax-efficient method. Transfers to NRE accounts are generally not subject to TCS, and the funds can be effortlessly moved to any account in India. This can offer a seamless way to manage your finances without tax-related apprehensions.
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Up0
Regarding the way the funds are being transferred, this, too, can influence whether or not TCS notifications are sent. If your husband is transferring directly from his UAE bank account, it may trigger the bank’s system to send a TCS alert.
However, if he employs a foreign exchange service for the transfer, such notifications are generally not triggered. Given that you haven’t noticed any actual deductions, it’s quite plausible that these TCS notifications may not be directly applicable to your transactions.
