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Time of India
06-06-2025
- Business
- Time of India
3.5% Excise Tax on transfers: What Trump's bill means for global Indians, Poonam Mirchandani decodes
Live Events (You can now subscribe to our (You can now subscribe to our ETMarkets WhatsApp channel President Trump and the Republican Government introduced a new bill 'The One, Big, Beautiful Bill', on May 12th 2025, which was approved by the House of Representatives by a 215-214 vote on May 22nd 2025 and is expected to be placed before the Senate later this the many changes proposed by the Government, one key change is introduction of Excise Tax of 3.5% (originally proposed as 5%) which shall be levied on any remittance amount transferred from United States of America ('Remittance Transfers')This change is applicable for all senders of such Remittance Transfers . The only exception being US Citizens or Nationals, subject to such remittance being undertaken by them through a 'qualified remittance transfer provider'.The Bill introduces parameters for qualified remittance transfer provider, which is an entity who enters into compliance agreement with the government agreeing to verify the status of remitter as citizen or national of US ('verified United States sender')If the sender is an individual, credit shall be available for aforesaid taxes paid subject to the verified United States sender mentioning his/her social security number as well as that of spouse (if sender is married) in return of tax for the taxable yearWhat this means simplistically, is that when any person who does not qualify as a verified United States sender, makes a Remittance Transfer, the remittance transfer provider will deduct a sum of 3.5% on the amount of transfer before completing the interesting part is that the Government has also introduced a secondary liability on the remittance transfer provider if they fail to make such deduction and deposit it with the authorities every quarter, they will be liable to pay the unpaid taxes personallyTherefore, every immigrant including Green card holders, immigrants on visas like H1B, L1, L2 etc. all will be impacted by this Remittance Transfer Excise Tax. In fact, even US Citizens if they don't make remittance through a qualified remittance transfer provider will have to pay this taxWhat the bill does not clarify is the definition of 'sender' for the purpose of this proposed Remittance Transfer excise the anti-conduit rules have been extended to remittance transfers, there is no clear provisions on whether corporates, entities, who hold accounts in US and make Remittance Transfers will have to pay this taxThe proposed Bill also does not clarify on how inter correspondent banking transfers be treated especially for international investors who are not US citizen or resident or Green Card holders or any other category of resident alien, but own investments through US brokers and US industry insiders are of the view that the tax will be only applicable for remitters who are resident in the US at time of transfer, how the qualified remittance transfer provider will distinguish such an international investor will be a key point of will be interesting to see how the law will shape up soon, as Senators work on developing changes to the Bill prior to placing it before the Senate later this month for approvalThe Bill does mention the Effective Date for this new Remittance Transfer Excise Tax as being with respect to transfers made after December 31, 2025. Similarly, tax credits, if available, shall apply to taxable years ending after December 31, 2025 NRIs historically have remitted funds earned in the US either back to India or invest them outside the US. In both scenarios, they will now have to pay 3.5% Remittance Transfer Excise Tax on any amounts which they remit after December 31, 2025This may activate a stream of outflow of money from US accounts by NRIs and other immigrants to their home countries or locations outside US to sidestep trigger of aforesaid anticipate families initiating planning for historical funds prior to the changes being implemented as well as restructuring their present account holdings outside post December 31, 2025 this window gets closed especially for individuals who generate regular income in US, who will have no choice but to pay this taxOn a separate note, the Bill puts at rest a constant debate on the sunset clause for US Estate and Gift Tax Exemption the proposed Bill, the original exemption amount of USD 5,000,000 has been substituted with USD 15,000,000 making it effective for taxable years beginning after December 31, will be a relief for many US Persons who are concerned that the current limits of USD 13.99 million will stand reduced to the original number of USD 5 the introduction of the revised provisions this fear will lay at rest as the government now has proposed scaling up the base limit to USD 15 million with future adjustments for inflationGiven the constantly evolving cross border legal and tax landscape, Indian HNIs and family businesses need to reassess their global financial planning . As cross-border tax regimes tighten, having structured, compliant platforms becomes US will continue to be a desired location for Indians while the UK remains a viable wealth gateway, particularly with recent Free Trade Agreement (FTA) gains, but each jurisdiction now carries unique tax implications that must be managed prudently and in a compliant manner with proper planning and advice.(The author is MD, Wealth Planning & Family Solutions, LGT Wealth India): Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)
Economic Times
06-06-2025
- Business
- Economic Times
3.5% Excise Tax on transfers: What Trump's bill means for global Indians, Poonam Mirchandani decodes
President Trump and the Republican Government introduced a new bill 'The One, Big, Beautiful Bill', on May 12th 2025, which was approved by the House of Representatives by a 215-214 vote on May 22nd 2025 and is expected to be placed before the Senate later this month. ADVERTISEMENT Amongst the many changes proposed by the Government, one key change is introduction of Excise Tax of 3.5% (originally proposed as 5%) which shall be levied on any remittance amount transferred from United States of America ('Remittance Transfers') This change is applicable for all senders of such Remittance Transfers. The only exception being US Citizens or Nationals, subject to such remittance being undertaken by them through a 'qualified remittance transfer provider'. The Bill introduces parameters for qualified remittance transfer provider, which is an entity who enters into compliance agreement with the government agreeing to verify the status of remitter as citizen or national of US ('verified United States sender')If the sender is an individual, credit shall be available for aforesaid taxes paid subject to the verified United States sender mentioning his/her social security number as well as that of spouse (if sender is married) in return of tax for the taxable yearWhat this means simplistically, is that when any person who does not qualify as a verified United States sender, makes a Remittance Transfer, the remittance transfer provider will deduct a sum of 3.5% on the amount of transfer before completing the transaction. ADVERTISEMENT The interesting part is that the Government has also introduced a secondary liability on the remittance transfer provider if they fail to make such deduction and deposit it with the authorities every quarter, they will be liable to pay the unpaid taxes personallyTherefore, every immigrant including Green card holders, immigrants on visas like H1B, L1, L2 etc. all will be impacted by this Remittance Transfer Excise Tax. In fact, even US Citizens if they don't make remittance through a qualified remittance transfer provider will have to pay this tax ADVERTISEMENT What the bill does not clarify is the definition of 'sender' for the purpose of this proposed Remittance Transfer excise tax. Though the anti-conduit rules have been extended to remittance transfers, there is no clear provisions on whether corporates, entities, who hold accounts in US and make Remittance Transfers will have to pay this tax ADVERTISEMENT The proposed Bill also does not clarify on how inter correspondent banking transfers be treated especially for international investors who are not US citizen or resident or Green Card holders or any other category of resident alien, but own investments through US brokers and US banks. Though industry insiders are of the view that the tax will be only applicable for remitters who are resident in the US at time of transfer, how the qualified remittance transfer provider will distinguish such an international investor will be a key point of deliberation. ADVERTISEMENT It will be interesting to see how the law will shape up soon, as Senators work on developing changes to the Bill prior to placing it before the Senate later this month for approvalThe Bill does mention the Effective Date for this new Remittance Transfer Excise Tax as being with respect to transfers made after December 31, 2025. Similarly, tax credits, if available, shall apply to taxable years ending after December 31, 2025 NRIs historically have remitted funds earned in the US either back to India or invest them outside the US. In both scenarios, they will now have to pay 3.5% Remittance Transfer Excise Tax on any amounts which they remit after December 31, 2025 This may activate a stream of outflow of money from US accounts by NRIs and other immigrants to their home countries or locations outside US to sidestep trigger of aforesaid tax. We anticipate families initiating planning for historical funds prior to the changes being implemented as well as restructuring their present account holdings outside US. However, post December 31, 2025 this window gets closed especially for individuals who generate regular income in US, who will have no choice but to pay this taxOn a separate note, the Bill puts at rest a constant debate on the sunset clause for US Estate and Gift Tax Exemption amount. Under the proposed Bill, the original exemption amount of USD 5,000,000 has been substituted with USD 15,000,000 making it effective for taxable years beginning after December 31, 2025. This will be a relief for many US Persons who are concerned that the current limits of USD 13.99 million will stand reduced to the original number of USD 5 million. With the introduction of the revised provisions this fear will lay at rest as the government now has proposed scaling up the base limit to USD 15 million with future adjustments for inflation Given the constantly evolving cross border legal and tax landscape, Indian HNIs and family businesses need to reassess their global financial planning. As cross-border tax regimes tighten, having structured, compliant platforms becomes critical. The US will continue to be a desired location for Indians while the UK remains a viable wealth gateway, particularly with recent Free Trade Agreement (FTA) gains, but each jurisdiction now carries unique tax implications that must be managed prudently and in a compliant manner with proper planning and advice. (The author is MD, Wealth Planning & Family Solutions, LGT Wealth India) (Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)
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Business Standard
26-05-2025
- Business
- Business Standard
Taxing time for migrants: US' remittance tax furthers Trump's agenda
The rationale for imposing the tax is ostensibly to protect dollar outflows. The US remains the world's top remittance sender. In 2023, some $85.7 billion was remitted by migrants living in the US Business Standard Editorial Comment New Delhi Listen to This Article Embedded in the 'big, beautiful' tax-and-spend Bill that the United States (US) House of Representatives passed by a razor-thin margin of one vote (215 for, 214 against) is a small, unattractive provision that is likely to hit a range of non-citizens in the US. This is the 3.5 per cent 'remittance tax' that is to be imposed on all green card and non-immigrant visa holders in the categories of H1B, L1 (which allow multinationals to temporarily transfer employees from foreign branches to the US) and F1 (students). The tax cannot be offset against other federal or state taxes paid in
Yahoo
21-05-2025
- Sport
- Yahoo
Our 15 favourite moments from the Ligue 1 season 😍 (3/5)
This article was translated into English by Artificial Intelligence. You can read the original version in 🇫🇷 here. It's time to talk about our favorites! Ligue 1 has come to an end this Saturday, May 17 (at least the championship part!). The 2024-2025 season has once again delighted us and made us want to highlight 15 players who have made us dream, for whatever reasons. Advertisement A little emotion and subjectivity, sometimes, doesn't hurt! Here are our three favorites (part 3). Maghnes Akliouche (Monaco) His fourth season in Ligue 1 is a new milestone. At 23 years old, the Monégasque midfielder is now a seasoned player whose technical finesse and elegance are appreciated. His regular performances and boldness on the ball make him a spectacular player that we can't wait to follow in the championship on weekends, and even on weekdays in European cups. Let's hope it lasts! Dilane Bakwa (Strasbourg) A revelation in the middle of a team that made a sensation. Dilane Bakwa surprised everyone this season. The Strasbourg left winger had a contrasting start to the season, frequently changing positions from the wing to midfield. Once integrated into Liam Rosenior's system, the former Bordeaux player became irresistible, particularly in big games. He will remain one of the key figures of this beautiful Strasbourg team that ignited the year 2025. Malick Fofana (OL) Another thrilling player from our beloved league of talents. At 20 years old, the Belgian gem was a bright spot in Lyon's sometimes cloudy sky. His technique, vision of the game, and dribbling stunned all observers of the championship. He finishes the season with a record of 5 goals and 4 decisive passes, and above all, an army of European admirers. Will we see him again on French pitches at the start of the season? We're keeping our fingers crossed! Also read: - Our 15 favorite players of the L1 season (part 1) Advertisement - Our 15 favorite players of the L1 season (part 2) - Chelsea unveils its new jersey 📸 FREDERIC DIDES - AFP or licensors
Mint
18-05-2025
- Business
- Mint
New US remittance tax proposal: What it means for NRIs sending money to India
A significant tax development is on the horizon for non-resident Indians in the US. The US government's House Ways and Means Committee has advanced a sweeping bill titled the 'One Big Beautiful" Tax Act, aimed at extending several provisions of the 2017 Tax Cuts and Jobs Act (TCJA) and introducing new tax measures. Among these proposals is the introduction of a 5% tax on remittances sent abroad, a measure that could directly impact thousands of NRIs who regularly transfer funds to their families in India. While the bill is subject to a Senate review and further debate, a majority of US Republican Party leaders aim to finalize it by 4 July. If passed in its current form, the remittance transfer tax will take effect on transfers made after 31 December 2025. Let's break down what this proposed tax means, especially for NRIs on H1B, L1, or F1 visas and Green Card holders. What is remittance transfer tax? Under the proposed Chapter 36C, Section 4475 of the US's Internal Revenue Code, a 5% tax will be levied on remittance transfers—that is, money sent by individuals from the US to recipients in other countries, including India. This tax is not based on income but on the amount being transferred abroad. For example, if you send $10,000 to India, you could be required to pay an additional $500 in tax. When will this tax apply? If enacted, the remittance transfer tax would apply to all qualifying transfers made on or after 1 January 2026. The accompanying refund and reporting provisions will apply to tax years ending after that date. Also read | How the India-UK Double Contribution Convention benefits employers and employees Who will be affected? This tax primarily affects non-citizen residents in the US, including NRIs on H1B, L1, or F1 visas, Green Card holders, and any individual who is not a verified US citizen or national. If you fall into any of these categories and send money to India, you could soon be required to pay this new tax. The proposed legislation provides a narrow exemption for verified US citizens and nationals and transfers made through 'qualified remittance providers" who have agreements with the US's Internal Revenue Service department to verify a sender's citizenship status. If a US citizen ends up paying the tax, they can claim a refundable tax credit, but only if they provide a valid social security number and supporting documentation. How will the tax be collected? The tax is collected at the point of transfer by the remittance provider, such as as bank or a money transfer service. The service provider will collect the 5% tax from the sender and deposit the tax with the US treasury department on a quarterly basis. If a provider fails to collect the tax at the time of transfer, they will become liable for the payment instead. Also read | ITR filing: Why you shouldn't rush to file taxes as soon as the portal opens Anti-abuse provisions To prevent circumvention of the remittance transfer tax, the proposal includes anti-conduit and anti-abuse rules. This means any indirect or creative structure used to avoid paying the remittance tax—such as funnelling money through third parties or shell accounts—could trigger enforcement actions and penalties. Let's say you are an H1B visa holder in the US and you send $20,000 to your parents in India in February 2026. Under the proposed law: This is over and above any other fees or charges that may already apply to international remittances. Also read | BluSmart lessons: Investors must look beyond high-growth stories What should NRIs start preparing for? Here are a few practical steps NRIs can consider: Final thoughts While this tax is not yet law, it represents a significant shift in US tax policy on foreign remittances. If passed, it will increase the cost of sending money abroad for a large segment of the NRI community, particularly those who are not US citizens. NRIs in the US should closely monitor legislative developments and consider speaking with a cross-border tax specialist to understand the full implications. What begins as a small percentage today can lead to a meaningful cumulative impact over time, especially for those with ongoing financial obligations in India. Ajay R. Vaswani is the founder of ARAS and Company, Chartered Accountants. This article is intended for general informational purposes only and does not constitute legal or tax advice. Please consult a licenced professional.
