Starting October 1, the Indian government will implement a higher Tax Collection at Source (TCS) rate of 20% on spending exceeding INR 7 lakh for foreign tour packages under the Liberalised Remittance Scheme (LRS). Banks have reportedly resolved technological challenges and are prepared for the higher TCS collection, which was initially scheduled for July 1 but deferred to October 1. Currently, funds transferred abroad under the Reserve Bank’s LRS attract a 5% TCS on amounts exceeding INR 7 lakh. The increased TCS rate of 20% was announced in the Budget for overseas tours, excluding educational and medical expenses. Individuals can claim credit for the TCS amount paid while filing income tax returns for the applicable assessment year.