## Clubbing of LRS Limit – Family Members & Special Cases

### 1. Clubbing for Remittances

The USD 2,50,000 LRS limit of family members CAN be consolidated for remittance purposes, provided each family member complies with the LRS conditions individually.

This is useful, for example, when a family pools funds for a single large purpose like overseas education or property purchase.

### 2. Clubbing for Capital Account Transactions (CAT)

Clubbing of LRS limits for Capital Account Transactions is NOT allowed unless the family members are co-owners of the overseas asset being acquired.

Thus, for joint acquisition of an overseas asset (e.g., joint purchase of a foreign property), each co-owner can use his/her LRS limit and the total can fund the asset; but if only one person is the owner, others cannot pool their LRS into his name.

### 3. Minors under LRS

A minor also has the LRS limit of USD 2,50,000.
However, the LRS Application Form must be countersigned by the minor's legal guardian (natural / court-appointed guardian).

Worked example

### Example 1

Example 1: Mr. and Mrs. Verma along with their adult daughter want to remit USD 6,00,000 collectively for their daughter's MBA abroad. Permissible without RBI approval?

Answer: Yes. Each of the three can use their LRS limit of USD 2,50,000 (total USD 7,50,000). They may club USD 6,00,000 for the remittance. Each individual must comply with LRS conditions.

### Example 2

Example 2: Mr. A wants to buy a house abroad for USD 5,00,000 in his sole name. He wishes to use his wife's LRS limit too. Allowed?

Answer: No. CAT clubbing is allowed only if the family members are co-owners of the overseas asset. If the house will be solely in Mr. A's name, his wife's LRS cannot be clubbed for the acquisition.

### Example 3

Example 3: A 10-year-old child has inherited some money. The father wishes to remit USD 1,00,000 under LRS in the child's name. Allowed?

Answer: Yes. A minor has his own LRS limit of USD 2,50,000. The LRS form must be countersigned by the natural guardian (father).

⚠️ Common exam mistakes

Believing LRS limits of family members can ALWAYS be clubbed – clubbing for CAT requires co-ownership.
Thinking minors don't get an LRS limit – they do, subject to guardian's countersignature.
Forgetting that for remittance-clubbing each member must still comply with LRS conditions individually (e.g., end-use restrictions on Nepal/Bhutan).
Treating 'family' loosely – only members satisfying the FEMA definition of close relatives can club.

Bare-Act text Master Direction – LRS, FAQ / Clarifications · RBI Master Direction on Liberalised Remittance Scheme · click to expand

Where the remittance is being made by family members, the limit may be clubbed if each family member complies with the LRS conditions. Clubbing is not permitted for capital account transactions unless the family members are co-owners of the overseas asset.

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Clubbing of LRS Limit and Treatment of Minors

Worked example

⚠️ Common exam mistakes