Buying US shares? A complete guide to rules, limits and taxation

Going global isn't just for the ultra-rich anymore. Indian investors have three legitimate routes into US stocks and global funds — and the RBI has clear rules for all of them. Here's your simple breakdown. Direct stocks: Apps like Vested or HDFC Securities Global Investing let you buy fractional shares of companies like Apple or Google.Indian feeder funds: Invest in rupees through mutual funds that track the S&P 500 or Nasdaq 100.GIFT City route: Platforms like INDmoney offer direct US stock ownership through India's own international exchange.

Under RBI's Liberalised Remittance Scheme (LRS), you can send up to $250,000 per financial year, that's over ₹2 crore, toward foreign investments. No special approval needed, just stay within the limit. Sending money abroad isn't free of upfront tax. Send up to ₹7 lakh in a year? No tax collected. Cross that limit? 20% TCS kicks in on the extra amount. Good news: it's not a penalty, it's adjustable against your final tax bill or refundable when you file your return.

Sell your US stocks at a profit? Here's the rule:Held under 24 months: Taxed at your regular income slab rate.Held over 24 months: Flat 12.5% tax, no indexation benefit.The same rules apply to international mutual funds and ETFs. The US taxes your dividends at 30% upfront (or 25% if you file a W-8BEN form). India taxes them again as regular income. The fix? File Form 67 to claim a Foreign Tax Credit, so you're not paying tax twice on the same money.

If you own foreign stocks, you must file ITR-2 or ITR-3 and declare them in Schedule FA and FSI, profit or no profit. Skipping this isn't just risky, it can trigger serious penalties under India's Black Money Act.