We need to pay a US university's tuition from India. Which transfer method is cheapest, and how does TCS work on education remittances?
1 Answers
Cheapest first:
- Fintech remittance services such as Wise and similar licensed providers, or the university's own payment partner (often Flywire). They have transparent fees and rates close to the market rate. Compare the final rupee cost for the same dollar amount.
- A bank wire with a negotiated rate. Ask for "interbank rate plus X paise" and confirm the processing and SWIFT charges. Some banks offer near-zero markup.
- A standard bank wire at card rates. This is the most expensive option: a high markup plus fees of ₹1,500–2,000.
TCS on education remittances (check the current rules, since they change):
- Up to ₹10 lakh per person per financial year: no TCS.
- Above that, for education funded by an education loan from a specified lender: no TCS.
- Above that, for education paid from your own funds: 5% on the amount above the threshold.
- TCS isn't an extra tax: it's credited against your income tax and refunded through your ITR if excess. But it ties up cash.
For large fees, splitting remittances between both parents uses two ₹10 lakh thresholds. Each parent remits under their own LRS limit.
To compare the all-in cost of a remittance, including GST on the conversion, use Worthify's LRS remittance calculator.
