- Exclusive offer: Discounted exchange rates for your first and ongoing transactions
- $0 transfer fee
- A higher exchange rate applies to non-Finder customers
- Send money in 50+ currencies
Sending money to India from Canada (or the other way around)? We break down what you need to know including the maximum limit for money transfers from Canada to India, limits on remittances from India and key tax rules.
There is no maximum limit for money transfers from Canada to India. You can send as much as you want. But beware that if you’re sending more than ₹50,000 to someone in India who isn’t a blood relative (including spouses, children, grandchildren, siblings and in-laws), they’ll have to pay tax to the Indian government.
There is no tax for recipients on money transferred from Canada to India when it’s being sent to blood relatives. In general, “blood relatives” — including spouses, children and grandchildren, siblings or in-laws — do not pay tax on any amount that you send.
However, if you’re sending more than ₹50,000 to someone in India who isn’t a blood relative, they’ll need to report it on their taxes. No matter how you send the money, your recipient could be on the hook for a gift tax if they aren’t a blood relative, as regulated by the Indian Income Tax Act. If the money is sent as inheritance or as a wedding gift, however, there won’t be any taxes levied on it by the Indian Income Tax Department.
Individual residents in India can transfer a maximum of USD$250,000 overseas each year (from April 1 to March 31 the following year), which includes transfers to Canada. You need a Permanent Account Number (PAN) to send funds. There is no limit to the number of remittances you can make from India, but the total amount can’t exceed USD$250,000 annually.
Prior to October 1, 2023, residents of India had to pay a 5% tax on remittances above ₹700,000 (around CAD$11,500). However, as of October 1, 2023, any money sent from India – except funds sent for medical or educational purposes – is subject to a 20% tax, including transfers to to Canada.
Medical and education remittances will continue to be taxed at a rate of 5%. Additionally, any transfers from India for education expenses paid from an education loan will continue to be taxed at a rate of 0.5%.
One other notable exception to the 20% tax rule is any payment by an individual India resident using their international Debit or Credit cards for amounts up to INR₹700,000 in a financial year.
Remittances from India can only be sent for certain reasons like gifts, donations, supporting close family members, business travel and studying abroad. You can’t send money from India for some purposes like buying lottery tickets or buying Foreign Currency Convertible Bonds (FCCBs) traded by Indian companies in overseas secondary markets.
Unless your transfer has any sales tax applied to it, you don’t usually have to worry about reporting and paying taxes to the CRA for transferring money abroad. Additionally, India has signed agreements with many other countries — including Canada — to prevent “double taxation,” or being taxed on money you’ve already paid income tax on.
If you don’t report a transfer on your taxes in India or report less than you should, you could be charged a penalty ranging from 10% to 200% of the taxes owed. The rate is determined by the circumstances of the case such as whether the offense was intentional.
With so much attention on money entering and leaving India, if you fail to report large sums, don’t know you have to report them or don’t report them correctly, it will likely be discovered. Make sure to declare any large remittance as income on your general tax return with the Indian Income Tax Department.
To avoid the severe penalties that could come with a failure to report large sums of money into the country, speak with a professional to guarantee that everything complies with the laws of both Canada and India.
Your recipient can pick up the cash in person or have the money deposited directly into their bank account or mobile wallet. Not every provider will offer all 3 options, so check before initiating a transfer.
In general, your recipient will provide an ID or a confirmation number for the transaction to pick up the money in cash.
If you’re sending money to a blood relative in India, they won’t have to worry about taxes — but if you’re sending money to a friend, they’ll need to report anything over ₹50,000 as income.
As with all international money transfers, be wary of potential fraud and only send money to people you know. Using a reputable provider can safeguard you from potential scams.
Find out about transfer methods and Canadian tax rules for receiving an inheritance from overseas.
Discover more about Africhange’s money transfer service including the Africhange app, its exchange rates and transfer speeds.
Send free wire transfers to Canada, Europe or the US when you exchange currency with Knightsbridge.
Learn about how Wise alternatives can help you send more money for less.
Wondering how Remitly works? Remitly international money transfer services offer solid exchange rates and lots of ways to get your money where it needs to go.
We compare the best international money transfer services available in Canada to help you find the best money transfer app for your needs.
The CRA won’t hit you with taxes for receiving funds from overseas—as long as it’s a gift.
Learn more about transferring money overseas quickly, easily and safely in an emergency.
Wise can help you make a fast, secure transfer at the mid-market rate.
Read our review of OFX and see if it’s right for your next international money transfer.
You must be logged in to post a comment.