Investing in US stocks from India involves a unique three-tier tax structure: Capital Gains Tax, Dividend Withholding Tax, and TCS on Remittance. This calculator helps you navigate these complexities correctly for 2026.
DTAA & Foreign Tax Credit (FTC)
India has a Double Taxation Avoidance Agreement (DTAA) with the US. When the US IRS withholds 25% tax on your dividends, you don't have to pay tax again in India on that same amount. By filing Form 67 along with your ITR, you can claim a 'Foreign Tax Credit' (FTC) to offset the US tax against your Indian tax liability.
US Holding Period: The 24-Month Rule
For foreign stocks (US equities), the holding period for 'Long Term' is 24 months, unlike the 12 months for Indian listed stocks. If you sell before 24 months, it is STCG and taxed at your income tax slab rate. If you sell after 24 months, it is LTCG and taxed at 12.5% (post-2024 budget changes) without indexation.
LRS & TCS: The Remittance Barrier
Under the Liberalized Remittance Scheme (LRS), you can send up to $250,000 abroad per year. However, any remittance exceeding ₹7 Lakhs in a financial year attracts a 20% TCS (Tax Collected at Source). While this is not an extra tax (you can claim it back in your ITR), it significantly impacts your initial investment capital.
Frequently Asked Questions
Is there double taxation on US stock dividends?
No. Thanks to the Double Taxation Avoidance Agreement (DTAA), you can claim a 'Foreign Tax Credit' (FTC) in your Indian ITR for the 25% tax withheld in the US.
Is the 20% TCS on LRS an additional tax?
No. TCS (Tax Collected at Source) is an advance tax. It can be used to set off your total tax liability or claimed as a refund.
⚠️ Disclaimer
The figures provided by this calculator are estimates based on the inputs you provide and standard financial formulas. STOCKCALC.IN does not offer investment advice. Please consult a qualified financial advisor before making any investment decisions.