Tax Collected at Source (TCS) is a tax regulation launched by the Government of India on 1 October 2020 for remittances under the Liberalised Remittance Scheme (LRS). The regulation stipulates a 5.0% tax must be charged on payments exceeding ₹10 lakh (1,000,000 INR; approximately 11,700 USD) made within India’s financial year from April to March.
The PAN (Permanent Account Number) of the payer will be used to determine TCS applicability. If applicable, TCS will be collected on top of the amount to be paid to your institution and Flywire’s banking partner will remit the funds to the tax authorities in India.
A quarterly TCS certificate will be issued by Flywire’s banking partner to the payer’s email address and the tax certificate can be used to claim the amount when filing your annual tax return.