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How much money can be transferred from USA to India?

These are the tax guidelines and regulations you should keep in mind when sending large amounts of money to India.

India is the world’s leading remittance recipient, with more than $12 billion sent from the US to India in 2019 alone. Knowing how much you’ll pay in tax and how the process works can give you peace of mind when sending money from the US to India.

How much money can I transfer from the USA to India?

There is no money transfer limit on how much you can transfer to India from the US, at least none imposed by the Indian or US governments. However, the specific money transfer or banking service that you are using might impose limits on how much they can accommodate in a single transfer. If you’re planning on initiating a large transfer, consider using a limit-free provider such as XE.

Do I have to report and pay taxes to transfer money from abroad to India?

When you send money to any persons abroad in India, the first $15,000 USD will be exempt from taxes by the IRS under the Gift Tax policy. This limit is charged on a per person basis — if you would like to send $15,000 USD each to multiple persons, you will still be off the hook for any gift taxes.

If you do send more than the allotted $15,000 USD, all you need to do is to file an IRS Form 709 to disclose the gift. On top of the $15,000 annual exclusion, you get an $11.7 million lifetime exclusion in 2021. Should you be fortunate enough to have remitted over $11.7 million, you may then be liable for gift taxes at a rate anywhere from 17% to 40%.

Sending a lot of money out of the country? Know what the IRS expects of you.

Tax for sending money from the USA to India

There is no recipient tax on money being transferred from abroad 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 about $700 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.

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Tax for India residents sending money abroad

How much money can you send from India to the US? Well, in February 2020, the Indian government introduced a new law that would put in new limits for remittances out of India. Because of this law, resident individuals in India can only remit a maximum of USD $250,000 overseas each year. Additionally, any amount remitted above ₹700,000, which translates to roughly 9,500 USD, will be taxed at 5%.

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Our table lets you compare the services you can use to send money abroad. Compare services on transfer speeds and fees, then click Go to site when you're ready to send.
Name Product Filter Values Fastest Transfer Speed Fees (Pay by Bank Transfer) Learn More
OFX
24 hours
$0

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OFX has no maximum limit transfers, with competitive exchange rates for 45+ currencies.
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Dunbridge Financial
24 hours
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Dunbridge Financial offers competitive exchange rates and zero fees on transfers to more than 120 countries.
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XE
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From $2.26

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Wise uses the mid-market rate and transparent fees to help you send money in 45+ currencies.
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What are the penalties in India if my recipient fails to file?

If you don’t report a transfer on your taxes in India, you could be charged a 10%, 50% or 200% penalty on the taxes owed, depending on whether it was considered intentional or not.

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 the US and India.

How will my recipient in India get the money?

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 three options, so check before initiating a transfer.

In general, your recipient will provide ID or a confirmation number for the transaction to pick up the money in cash.

How to send money to India

Frequently asked questions

What is the IRS limit on sending money to India?

The IRS has no limit on how much money you can send to India. However, above $11.7 million USD, you’ll be liable for taxes.

How to avoid double taxes on money transfers to India?

Since India has a Double Taxation Avoidance Agreement with various countries, including the US, it would typically be very rare for you to be accidentally taxed twice. Should you be double-taxed, do work with a financial advisor to assess the specific provisions under which you can claim a tax credit and recoup your money.

Can I avoid IRS penalties if I fail to file?

Yes, you can avoid IRS penalties if you can show reasonable cause for your failure to file — such as a house fire, serious illness or natural disaster. Additionally, because of the pandemic, the IRS has delayed the deadline to file taxes and simply waived other types of taxes. Consult your personal financial advisory on the impact this might have on you.

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36 Responses

    Default Gravatar
    SnehaNovember 29, 2020

    I received 30000 cad as equalization amount on divorce..I want to send this amount to my father in india..do I have to pay taxes in canada

      Avatarfinder Customer Care
      ZakNovember 30, 2020Staff

      Hi Sneha,

      Thanks for reaching out.

      Transfers over CAD$10,000 will automatically be reported to FINTRAC by the bank or money transfer provider you’re using to send the money. In short, whether you’ll need to pay taxes on it or not is dependent on how the equalization was paid to you: consulting with your attorney would be best in this situation to make sure you won’t face a tax penalty later on.

      Please refer to our Canadian guide for more information on money transfer taxes in Canada.

      Hope this helps,
      Zak

    Default Gravatar
    ShammiMay 7, 2019

    Hi! I sent Rs72,000.00 through wire transfer to non relative to India and they are telling me that the bank has deducted Rs.25,000.00 as TDS which looks very weird to me. It is Axis bank, is this true? Thanks

      Avatarfinder Customer Care
      MaiMay 7, 2019Staff

      Hi Shammi,

      Thank you for reaching out.

      It shows that if your recipient in India is not related to you, any amount over 50,000 rupees that you send is taxable and must be declared as income.The amount of the tax will depend on your recipient’s income tax bracket.

      Hope this helps! 😊

      Kind Regards,
      Mai

    Default Gravatar
    DipakMarch 25, 2019

    For sending remittance from UAE self bank account to India self bank account for investment purpose ( say FD or mutual funds etc.) is there any limit of amount per remittance or per year which can be sent . Remittances are sent through bank channels only.
    Is it necessary to inform the India IT Dept on such remittances.

      Avatarfinder Customer Care
      JeniMarch 28, 2019Staff

      Hi Dipak,

      Thank you for getting in touch with Finder.

      I’m afraid that you need to confirm the limit of remittance and other requirements with the banks you’re having transactions with in the UAE and India.

      I hope this helps.

      Thank you and have a wonderful day!

      Cheers,
      Jeni

    Default Gravatar
    JaneFebruary 3, 2019

    My sister is transferring some Euros to India via Transferwise, is that money taxable in India?

      Avatarfinder Customer Care
      JhezFebruary 4, 2019Staff

      Hello Jane,

      Thank you for your comment.

      When you send money to India from an online remittance service, you will not be required to pay taxes on that amount if you are an NRI. However, if you are not an NRI then you will have to pay taxes on the global income.

      An NRI can transfer funds from UK to India in his NRE account securely and conveniently. NRIs don’t have to pay taxes when they transfer money to India. Since they already pay tax on the amount earned in the country where they are working, they are not required to pay further tax on the same money. This is irrespective of whether they keep the money in Indian Rupees or Euros.

      Regards,
      Jhezelyn

    Default Gravatar
    VictoriaJanuary 18, 2019

    If money transfer from Canada to India at around $355,000, does it transfer directly to the account of the Indian beneficiary?

      Avatarfinder Customer Care
      JeniJanuary 18, 2019Staff

      Hi Victoria,

      Thank you for getting in touch with finder.

      Basically, international bank transfers automatically send funds to the receiver’s bank account. However, transfer fees and exchange rates apply to the transaction, so it’s worth comparing specialist online money transfer companies to see if you might be able to find a better deal.

      I hope this helps.

      Thank you and have a wonderful day!

      Cheers,
      Jeni

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