No, the Liberalised Remittance Scheme (LRS) does not apply to NRIs. It is only for individuals who are resident in India under FEMA. As an NRI, you move money abroad from your own accounts instead: NRE and FCNR balances can be sent out freely, and you can send up to $1 million a financial year from your NRO account.
Below is who counts as resident for LRS, how each NRI route works, and what changes when you move abroad or come back to India.
Table of contents
- Does LRS apply to NRIs?
- How do NRIs send money abroad?
- What happens to LRS when you move abroad or return to India?
Does LRS apply to NRIs?
No. The RBI's LRS FAQs say the scheme allows "all resident individuals, including minors" to remit up to $250,000 a financial year. An NRI is, by definition, not resident under FEMA, so the scheme is not open to them.
What counts here is residency under FEMA, not under the Income-tax Act. Broadly, you are resident under FEMA if you lived in India for more than 182 days in the previous financial year.
You stop being resident from the day you leave India for a job, a business or any other reason that shows you mean to stay abroad for an uncertain period, even if you spent most of the year in India.
Note: Your FEMA status and your income-tax residency can differ in the same year. LRS follows FEMA, while TCS and the taxing of your income follow the Income-tax Act.
How do NRIs send money abroad?
NRIs send money abroad from their NRI accounts, and the rule depends on the account:
| Account | What it holds | Sending money abroad |
|---|---|---|
| NRE (Non-Resident External) | Money earned abroad, kept in rupees | Freely, principal and interest, with no annual cap |
| FCNR(B) (Foreign Currency Non-Resident) | Money earned abroad, kept as a foreign currency deposit | Freely, with no annual cap |
| NRO (Non-Resident Ordinary) | Income earned in India, such as rent, dividends or pension, and money from selling assets in India | Current income such as rent, dividends and pension: freely, after tax. Balances and asset sale proceeds: up to $1 million per financial year |
The $1 million limit comes from the RBI's Master Direction on remittance of assets. It covers balances in your NRO account and the proceeds of property or other assets you sold, and it includes transfers from your NRO account to your NRE account.
All instalments in a year must go through the same bank. The bank asks for proof of how you acquired the assets, your undertaking that the money comes from legitimate receipts in India, and a chartered accountant's certificate.
Current income is treated separately. Rent, dividends, interest and pension credited to your NRO account can be sent abroad after tax, with a chartered accountant's certificate, without counting against the $1 million.
Example. Suppose you are an NRI in Dubai and you sell a flat in Pune. After tax, the sale proceeds land in your NRO account. You can send up to $1 million of it abroad this financial year with the CA certificate (Form 15CB) and the online Form 15CA, and the rest in the following years.
Note: Remittances from NRE, FCNR and NRO accounts are not LRS remittances, so there is no TCS on them. Tax on the income itself, such as TDS on rent or capital gains, still applies.
What happens to LRS when you move abroad or return to India?
When you move abroad. LRS stops applying from the day you become non-resident under FEMA. Your resident savings accounts should be converted to NRO accounts, and you move money abroad from then on through your NRE, FCNR or NRO accounts.
Investments you made abroad under LRS while you were resident, such as US stocks or ETFs in a global brokerage account, stay yours. As a non-resident, you can keep holding them and add to them with money you earn abroad.
When you return to India. You become resident under FEMA again once you come back to take up a job, run a business or stay for an uncertain period. From then on, any new money you send abroad goes through LRS, with Form A2, the $250,000 limit and TCS above ₹10 lakh.
Foreign assets you built while you were an NRI are not counted against your LRS limit. You can keep holding them after you return, and you report them in Schedule FA of your income-tax return once you are resident and ordinarily resident (ROR). Most returning NRIs are RNOR for their first two or three years, and Schedule FA does not apply until that period ends.
Example. Suppose you worked in Singapore for eight years and built a $300,000 portfolio there, then moved back to Bengaluru in 2026. You can keep the whole portfolio. If you later want to add $50,000 from your Indian salary, that goes out under LRS and uses $50,000 of your $250,000 limit for the year.
About Paasa
Paasa is a global investing platform for Indian residents and NRIs. It gives you direct access to stocks on their home exchanges in the US, Canada, the UK, Germany, France, Switzerland, the Netherlands, South Korea, Japan, Hong Kong and Singapore, along with ETFs and UCITS funds.
- A dedicated relationship manager: one point of contact for questions about your account and your investments.
- Built for residents and NRIs: invest in global markets as an NRI, and keep investing under LRS when you move back to India.
- Tax reports in one place: capital gains, dividends and Schedule FA workings for the years you are resident and ordinarily resident in India.
