Prohibited Current Account transactions

Prohibited Current Account transactions (V.Imp!!!!) – you can’t draw foreign

exchange for:-

1. Forex can’t be drawn for making payment to any person in Nepal or Bhutan! Use Rupees!

2. Remitting lottery winnings outside India.

Remitting any income from winning in any races/ horse races/ hobbies etc.

3. You can’t remit any money outside India for the purchase of lottery tickets, or banned magazines, sweepstakes, betting etc.

4. You can’t draw forex for making payments on any ‘Call Back Services’ on telephone calls – call back is when you call and then immediately get a call back being routed through the telephone services of a company where charges are lower

Approval of Central Government needed for:

1. Drawal of forex for taking cultural tours outside India.

2. If state government or its undertakings advertise in foreign print media (for any purpose other than promotion of tourism, investments – exceeding USD 10,000) – then CG approval needed!

3. Remittance of prize money, sponsorship of sporting activities abroad by persons other than sporting bodies – if the amount being remitted exceeds USD 1,00,000.

4. Remittance for hiring of transponders by ISPs and TV channels.

Approval of RBI needed for:-

1. For infrastructure projects – if the consultancy is taken from outside India and the remittance for such exceeds USD 1,00,00,000 per project.

2. For any other projects – if the consultancy is taken from outside India and the remittance for such exceeds USD 10,00,000.

3. Approval of RBI needed to release forex in excess of USD 10,000 in one financial year.

4. Approval of RBI needed for gift/ donation remittances in excess of USD 5,000 in one financial year, per remitter or donor (the receiver of the gift remittance)

5. Exceeding USD 1,00,000 for persons going abroad for employment/ emigration.

6. Exceeding USD 25,000 for business travel, attending conference etc.

7. Medical treatment abroad – based on doctor’s estimate of expenses – if doctor’s estimate exceeds USD 1,00,000 – then no approval is required.

11. The limit under Liberalised Remittance Scheme, has be increase to USD 2,50,000 per financial year for permissible current or capital account transaction or a combination of both, whereby all resident individuals, including minors, are allowed to freely remit to that extent – the increase came in 2015.

This 11th point has been asked in a couple of interviews irrespective of candidate’s educational background - so keep this new limit in mind for upcoming exams and/ or interviews!!