Country edition: India
India side · Money

Paying for Study Abroad from India: TCS, Loans and Tax

Government of India and official sources·Last checked 29 Oct 2026

Before any visa, the money has to leave India legally and in a way the visa office will accept. These are the Indian rules that apply whichever country you choose.

Choose a country
TCS, loan-funded fees
Nil, on remittances from an education loan [2]
TCS, own money
2% above ₹10 lakh a year (Budget 2026-27) [1]
Loan interest deduction
Up to 8 years (Section 80E) [4]
PM-Vidyalaxmi
India institutions only, not foreign study [5]
01 Tax collected at source

TCS when you send fees abroad

  • Budget 2026-27 cut TCS on Liberalised Remittance Scheme (LRS) payments for education and medical treatment from 5% to 2%. It applies to the amount above ₹10 lakh in a year. [1]
  • From Budget 2025-26, money sent for education out of a loan from a specified financial institution has no TCS. [2]
  • TCS is not an extra tax: it is credited against your (or your parent's) income tax and can be claimed back in the return. [3]

Your bank's forex desk applies these rules when it sends the money. Keep the remittance advice: visa offices often want proof that fees were paid. [1]

02 Education loans

Loans and the interest deduction

  • Section 80E lets the person who repays an education loan deduct the interest for the first year of repayment and up to seven years after, or until the interest is paid, whichever is earlier. [4]
  • The PM-Vidyalaxmi interest-subvention scheme covers loans for admission to designated Quality Higher Educational Institutions in India. Foreign institutions, Indian campuses of foreign universities and foreign campuses of Indian institutions are not covered. [5]
  • Most visa offices want the loan disbursed or sanctioned in writing. Australia, for example, says the best evidence for a loan is proof of disbursement. [8]
03 Government of India

National Overseas Scholarship (SC and others)

  • The Ministry of Social Justice scheme gives up to 125 new awards a year for master's and PhD study abroad, with a cap of 10% per state. [6]
  • Family income must not exceed ₹8 lakh a year; the applicant must be 35 or younger on 1 April of the selection year and have at least 60% in the qualifying exam. [6]
  • Support runs for up to 3 years for a master's and up to 4 years for a PhD. [6]
  • The Ministry of Tribal Affairs runs a separate National Overseas Scholarship for ST students (20 awards a year). [7]
04 Official sources & verification

Where these facts come from

Every fact above is read from the official pages below (government, embassy, regulator, test owner or university), last checked on 29 October 2026. Visa money, fees and work rules change several times a year — open the official page before you pay or apply.

  1. Union Budget 2026-27 — Budget speech (opens in a new tab) TCS on education 5% → 2% · Last checked 29 Oct 2026
  2. Business Standard — Budget 2025: no TCS on education loan remittances (opens in a new tab) Nil TCS on loan-funded fees, ₹10 lakh threshold
  3. Income Tax Department — Deductions and TCS credit (opens in a new tab) TCS credited against tax
  4. Income Tax Department — Section 80E (opens in a new tab) 8-year interest deduction
  5. PIB — PM Vidyalaxmi Scheme (29 Jul 2026) (opens in a new tab) Foreign institutions not covered
  6. Ministry of Social Justice — National Overseas Scholarship for SC etc. candidates (opens in a new tab) 125 awards, ₹8 lakh, age 35, 60%
  7. Ministry of Tribal Affairs — Scholarships (opens in a new tab) NOS for ST students
  8. Home Affairs (Australia) — Student visa (subclass 500) (opens in a new tab) Loan disbursement evidence · Last checked 29 Oct 2026

Spotted something out of date? Email margdarshan07support10@gmail.com with the official link and we will update it.

More study-abroad guides