Taxes That You have to Pay on Foreign Exchange Transactions in India

Just like any commodities and services, taxes are also applied on the foreign money conversion process in India. In other words, if you want to convert Indian currency into foreign currency or you want to convert foreign currency into Indian currency, you have to pay certain taxes to the money conversion dealer. Every authorized currency converter dealer in India, as approved by the Reserve Bank of India, will apply taxes on foreign money exchange process. Previous tax rules have been amended in India after introduction of GST (Goods and Services Tax) in the year of 2017. As per the GST rules, 18% tax will be levied by the government on foreign money conversion. However, the notable thing is that not all transactions are taxable. There are a few slabs for taxing and the details are discussed below.

Slab 1: Up to 1 Lakh

Up to one lakh amount, only 1% of the currency amount has been regarded as taxable and the minimum taxable value is INR 250. So, with this statement, you can understand that if you want to convert INR 20000, you do not have to pay any taxes. The reason behind this is that 1% of the 20,000 amount is equal to INR 200. Currency conversion will be taxable only when you have minimum amount of INR 25000 to convert.

1% of 25000 = INR 250

Now, 18% GST will be applied on this amount.

18% of INR 250 = INR 45

So, for converting INR 25000 amount into foreign currency, you have to pay INR 45 addition charge as GST. GST is not applicable on the commission fee of the currency converter dealer.

Slab 2: INR 1 Lakh to INR 10 Lakh

In this slab, the taxable value is equal to 1000+0.5% of the amount. For example, you want to convert INR 5 lakh into foreign currency. So, the GST on your conversion will be decided in the following method.

Taxable Amount = 1000 + 2000 (0.5% of the (5-1) lakh) = INR 3000

So, INR 3000 is the amount on which GST will be applied. After adding GST, you shall get the following figure:

18% of GST on INR 3000 = INR 540

Trusted Currency Dealer

For currency exchange or transfer money abroad, you need to find trusted currency conversion dealer. For that reason, you can choose CurrencyKart. This is online based currency exchange service which is trusted as it has been approved by the RBI.

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What are the Benefits you can enjoy with Money Exchange Services?

When it comes to money exchange services, then there are hundreds of options that you can come across. Today, online money exchange has become more popular as compared to the old methods of exchange. With the online facility you can now exchange your foreign currencies easily at any time you want. If you are planning to leave for USA day after tomorrow, then you can immediately visit an online website and set up for money exchange or currency exchange within tomorrow or today itself. This service is offered by banks and financial institutions for the convenience of the customers. There is no extra charge for availing this kind of immediate Foreign Exchange in Gurgaon.

How can you exchange the cash you save on your foreign tour?

Sometimes it so happens that we save some extra currencies after coming back from a holiday. In that case what shall you do? How will you use the money that you have? Well, the only option you have is exchanging them. With the online facility that I have already mentioned above, you can simply visit an online website and set up for currency exchange or sell foreign currency service. The best part is that you can opt for the home delivery option, which is available at free of cost. But there are some financial institutions that charge certain amount if the exchange amount is below their specified limit. There are hundreds of online financial institutions offering Money Exchange in Noida, you just need to have patience to browse through each of them to come up with the best possible option.If you have to travel regularly, then I assume that you need to opt for the money exchange service frequently. Using the online facility is the most suitable option in this case.

Currencykart is known for being a popular online foreign exchange platform where you can buy, sale as well as transfer money to any part of the world for a very nominal amount. They do not charge excessive commission or percentage for the exchange service and you can even say that the exchange rate is zero for some specific deals. They offer free home delivery service along with hundreds of facilities for the customers. I have already dealt with Currencykart, and hence recommended to everyone who needs foreign exchange service time and again.

Everything That You Need To Know About Money Exchange

Getting a foreign exchange in your journey to some nomadic place can give you a hard time. You need to be prepared for that thing, and in order to get started with so many other things, there are many exchanges and many other shops that can help you to get the exchange for a particular price. If you are doing this for the first time then here is all that you need to know.

In this guide, we will help you to get the Currency Exchange in Faridabad at best prices. However, all you need to do is to get started with the tips that are mentioned in the section below. Keep all that in your mind and it will turn out to be really beneficial for you all. Let us get to the guide and make sure that you go through all the things as mentioned in the section below.

What to avoid while getting a foreign exchange?

Here are a list of things that every traveller end up doing and thinking that they are smart then maybe you are getting wrong. If you are in a newbie to a new place then there are high chances that you will get up looted and lose many of your money as the tax and other high exchange rates. You shouldn’t get to these places as mentioned in the section –

1) Airports

Welcome to the bazaar that will loot the hell out of you. Trust me they take full advantages of being in the most prominent places, and with the sky-high prices for the money exchange, one should never get to them until you are in need of that. This is the only way they get the advantage of your time and in such a case when you are in a hurry for the ticket at the counter then this can give you some really high prices for the exchange.

2) Local Markets

So, now you think you played smart? Hah, well no, you didn’t and there are a lot of things that you need to know beforehand. If you are in a local market for Money Exchange in Ghaziabad or even in any place, then there are high chances of you getting fraud. Do you think that these small shops will ever help you to shop for a lesser price? Get a life and try out some realistic and some logical thing for that.

3) Banks

Getting to banks and you are fascinated with the services provided by them at such high rates? Well, they are just high standardized thieves and you don’t get yourself in the trap. You will never get the best price and instead with all these formalities, it is better to have your money exchange somewhere else.

Where to get money exchanged?

There are so many reliable ways in which you can get the money exchanged easily. You can use many applications for transactions, and they will give you the best price with some amazing offers online. Get your hands on one of them, and you will get some amazing things done with it.

How and Where to Exchange Foreign Currency

In order to exchange foreign currency you need to be well aware of the exchange procedure to save maximum time and money. The better you are aware, the simpler it gets. The idea is to identify a currency exchange vendor that converts currency without having to go through lengthy queues and offers a quick and reasonable service. In this article, we will learn about from where and how to exchange foreign currency.

Forex Exchange Centers:

You can get your money exchanged at the banks, post office, airport and private centers. But the easiest option out all would be to go to your bank. The best part is, most of the banks charge a minimal fee in exchange for the currency conversion. But, this might take a little longer, depending upon the availability of the currency you want to exchange to. Therefore, it’s highly advisable to plan at least a week or two prior to your travel.

Forex Exchange Dealers:

You may also take assistance of private agents and forex dealers to help you exchange foreign currency. Though, it will cost you higher than what your bank would charge, but considering the amount of time and efforts saved, this option is totally worth the price. Please ensure that the vendor has a money changing license issued by the RBI.  Also, make sure to get your bills on every transaction.

Foreign Exchange Websites:

There are several foreign currency exchange services available online to help you convert the currency without rushing to your bank or a forex exchange center. Some of the reliable and popular ones are, Currency Kart, Book My Forex, and PayPal.

Forex Travel Cards:

Another convenient and smarter way to get your currency exchanged is a Forex card. Just like a debit card, there are forex cards where transaction would be debited from your account balance. Forex cards are pre-loaded with a number of currency options making it easier for you to travel around the globe.

Things to remember

Compare currency rates:

Well, it is highly recommended to check the currency rate before exchanging your money so that you get maximum out of the conversion. The rates are keep on fluctuating time to time and the exchange rate also vary from vendor to vendor. Therefore, be sure to check the conversion rate from at least 3 vendors to avoid losing money upon conversion. You can also check the conversion rate online, just type on the Google search and it will show you links to various conversion sites available online as well as the latest conversion rate.

Avoid airport outlets

Exchanging money at the airport outlets could be an expensive option. They tend to charge about 10 to 15 percent of your conversion amount. Therefore, if you have time consider other options discussed above in the article.

 

Why is it not a good idea to exchange currencies locally?

Getting currency exchanged locally from a reputed source is definitely an issue. The problem lies in the fact that every currency converter in India isn’t certified thus their reliability is highly low. Moreover, getting money exchanged from non-certified or local converters is extremely expensive as you pay hefty charges as fees. There are more reasons because of which we advise our readers to choose safer ways of exchanging foreign currency instead of going for dubious money exchange shops.

 

1. Trusting the local currency exchange agencies is difficult, especially those who aren’t certified by the government

The first reason for choosing against money conversion shops located in the nooks and corners of India is their reliability. Most of such shops are into illegal business of exchanging foreign currency; they aren’t certified by the government thus they either pay you lesser foreign exchange rate or charge a bomb as their conversion fees. Their practice of not paying according to the current exchange rates is a well-though plan of making more money from their customers. They keep you in dark so that they can pay you lesser than the updated currency exchange rate and fill their pockets with the rest of the converted amount. Even their sources of acquiring foreign currency isn’t reliable at all thus at times, you might be a victim of fraud and may receive fake foreign currency. To avoid falling in their trap, ask them if they have the legal license for foreign exchange issued by the Indian Government. No matter how nice their foreign exchange rate sound to you, you are advised to maintain your distance from such fraudsters.

To check the legality of your agent, ask them for their GST number. Or ask them to provide a printed invoice for your transaction.

2. Does your agent give you the best foreign exchange rate of the day?

The traditional currency exchange shop do not have a mechanism to keep an eye on the ever fluctuating foreign currency exchange rate. For example, at 11:00 am USD = 60 INR while at 4:00 pm, it is equivalent to 62 INR. Ideally, if you approach your currency conversion agency at 5 pm, you need to get the highest foreign exchange rate of the day. But we can bet that your agent will still offer you Rs. 60 for every dollar. It is either they do not get live updates on the changing rates or they like to make more profit by hiding information from their customers. In either case, it is a loss for you.

The best way of exchanging currency near you is going online and choosing a reliable service provider such as Currency Kart. Plus when making online currency exchange, you get live updates on the currency rate and can choose the time when the rate is the highest to ensure that you get a profitable deal for yourself. Beware of fraudsters to keep your hard earned money safe.