Smart things to know about funding students abroad

1) The students who go abroad for studies are treated as non-resident Indians (NRIs) from the day they leave the country. All the provisions that apply to NRIs under the Foreign Exchange Management Act ( FEMA) are also valid for them.

2) The limitation for remittance of fee is $100,000 per year, or the actual fee, based on documentary proof from the institution where the student is enrolled, whichever is higher.

3) The remittance for living expenses up to $2,00,000 can be sent through a bank, after executing a self-declaration form by close relatives.

4) The bank may ask for a CA certificate or income tax returns, depending on the length of the client's relationship with it, as well as its internal processes and due diligence.

5) The foreign exchange that can be carried by such students while travelling abroad is not subject to limits, but declaration at the Immigration and Customs counters for amount exceeding $10,000 is mandatory.

The content on this page is courtesy Centre for Investment Education and Learning (CIEL). Contributions by Girija Gadre and Arti Bhargava.