Paying overseas college fee easier, but little else changes

When Veena Mathew sent her 23-year-old son to pursue computer science in London last year, she didn't just take on a ₹50 lakh education loan - she also had to navigate India's complex tax collection system on foreign remittances.

- HT Correspondent

JAIPUR/NEW DELHI:

But Union finance minister Nirmala Sitharaman's latest budget brings some relief to parents like Mathew, who finance their children's overseas education through loans.

The budget has removed the Tax Collected at Source (TCS) on foreign education remittances when funded through loans from specified financial institutions. Previously, such transactions attracted a 0.5% TCS on amounts exceeding ₹7 lakh. In her eighth consecutive budget speech, the minister also raised the general threshold for TCS on overseas remittances from ₹7 lakh to ₹10 lakh, though non-loan funded education payments will still attract a 20% TCS above this limit.

"Foreign education cannot ever be a right reserved for the rich," said Mathew, a schoolteacher in Rajasthan with an annual income of ₹8 lakh. "Middle-class parents also dream to send their children abroad for study and ensure a better future for them."