When you add funds from your Indian bank account to invest in US stocks, the transaction is treated as an international (outward) remittance under RBI’s Liberalised Remittance Scheme (LRS). As a result, a few standard charges apply. These charges are not platform-specific and are applied by banks and authorised dealers as per regulations.
1. Currency Conversion Charges (FX Markup)
Your funds are converted from INR to USD before being credited to your US investing wallet.
Banks and authorised dealers apply a currency conversion markup, which is the difference between the interbank (mid-market) exchange rate and the rate offered to you.
This markup varies by bank and market conditions
It is built into the exchange rate you see
It is not charged as a separate line item
This is a standard practice for all foreign currency transactions.
2. GST on Currency Conversion
GST is not charged on the full remittance amount.
Instead, it is applied only on the service value of the currency conversion, as defined by Indian GST rules.
GST rate: 18%
Calculated using government-prescribed slabs
The taxable value is a small portion of your remittance amount, not the entire amount
This GST is shown upfront before you confirm the transaction
This calculation method is uniform across banks and platforms and is mandated by law.
3. Bank Processing / Remittance Fees
Some banks may charge a fixed processing or remittance fee for handling international transfers (for example, ₹500 or ₹1,000).
This fee depends entirely on your bank’s policy
If charged, 18% GST on this fee is added by the bank
These charges usually appear directly in your bank statement
Since these fees vary by bank, they may not always be visible in the app.
4. TCS (Tax Collected at Source)
As per Income Tax rules under LRS, TCS may be applicable on outward remittances.
TCS is collected by your bank at the time of remittance
The rate depends on your total LRS usage in the financial year
TCS is not a cost; it can be adjusted or claimed as a credit when you file your income tax return
TCS applicability and rates are governed by government regulations and not by the platform.
Where will these charges appear?
• In the app:
- FX rate (including bank markup)
- GST on currency conversion
• In your bank statement:
- Bank processing fees (if any)
- GST on bank fees
- TCS collected under LRS