Master prompt
Source of funds + FEMA / LRS / ODI compliance for Indian applicants (Ireland)
Trace source of funds for STEP / IIP transitional / employment-permit routes from India through LRS, ODI, and business-sale channels; handle 15CA/15CB tax clearance and bank tracing.
IrelandInvestor visaSource of fundsFEMALRSODI15CA 15CBRBI
You are advising [CLIENT_NAME] on the source-of-funds + Indian outward-remittance compliance required to fund [TARGET_ROUTE] in the amount of EUR [AMOUNT_EUR]. Funds currently sit in [FUND_LOCATION], primary source [PRIMARY_FUND_SOURCE], funds in client's hands for [AGE_OF_FUNDS], Indian tax compliance status Yes - all 5 years.
REGULATORY ANCHORS - INDIAN SIDE
- FEMA 1999 + Master Direction on LRS (Liberalised Remittance Scheme)
- Master Direction on Overseas Investment 2022 (replaces ODI / OPI Regulations)
- Income-tax Act 1961 s.195 + Rule 37BB - Forms 15CA / 15CB
- Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act 2015
- PMLA 2002 + RBI KYC Master Direction
REGULATORY ANCHORS - IRISH SIDE
- ISD source-of-funds verification policy for STEP / IIP / employment permits
- Criminal Justice (Money Laundering and Terrorist Financing) Act 2010
- Irish bank AML / KYC at account opening
- Revenue tax-residency analysis if client takes up Irish residence
§1 - MAP THE AMOUNT TO THE INDIAN-LAW REMITTANCE ROUTE
The amount [AMOUNT_EUR] is the key constraint. Indian-resident individuals can remit
abroad under THREE main channels:
CHANNEL A - LRS (Liberalised Remittance Scheme) - individual cap
- USD 250,000 per individual per financial year (April 1 to March 31)
- Currently approximately EUR 230,000 at EUR/USD parity (verify spot rate)
- Available to all resident individuals (incl. minors via guardian)
- No prior RBI approval needed
- Purposes include: investment in foreign equity, debt, property; gift; donation;
maintenance of close relatives; education; medical; employment; immigration
- "Immigration" is a permitted LRS purpose
- Bank deducts TCS (Tax Collected at Source) at 20% for remittances >INR 7 lakh in a
year for purposes other than education/medical (verify current TCS rates)
- TCS is creditable against income tax liability when filing ITR
CHANNEL B - ODI (Overseas Direct Investment) - corporate or qualifying individual
- Under Master Direction on Overseas Investment 2022
- Indian companies can invest abroad up to 400% of net worth (Automatic Route)
- Indian individuals can also make ODI under LRS framework but with additional
reporting (Form FC for ODI)
- Suitable for: client owns Indian Pvt Ltd which establishes Irish subsidiary; Indian
company invests in the Irish entity as parent
- Reporting: APR (Annual Performance Report) for ongoing ODI
- For amounts beyond LRS cap, ODI by Indian corporate is the typical structure
CHANNEL C - SALE OF FOREIGN ASSETS / NRI-source funds
- If [CLIENT_NAME] is already an NRI (Non-Resident Indian) with offshore funds (NRE/
FCNR accounts or genuine offshore earnings), those funds can be remitted to Ireland
without LRS cap
- If client recently became NRI: transition rules under FEMA require careful tracing
- If client has prior overseas earnings that were properly declared and taxed: those
can be repatriated subject to bank documentation
For [AMOUNT_EUR]:
- If <= EUR 230,000: LRS alone may suffice (one financial year)
- If <= EUR 460,000 across two FYs: split across April-March boundary using LRS twice
- If higher: requires ODI route (via Indian corporate) OR multi-year LRS planning OR
pre-existing offshore funds (NRI status)
Cross-reference No:
- If "Yes": ODI via the company is a strong option for amounts beyond LRS cap
- If "No": LRS multi-year or NRI conversion strategies apply
State the RECOMMENDED REMITTANCE STRUCTURE for [CLIENT_NAME].
§2 - TRACE THE PRIMARY SOURCE OF FUNDS
ISD (and Irish banks at account opening) will demand a complete chain of evidence for
[PRIMARY_FUND_SOURCE]. Build the dossier as follows:
IF PRIMARY SOURCE IS SALE OF BUSINESS:
- Share purchase agreement (SPA) between buyer and [CLIENT_NAME]
- Board resolutions approving sale
- CA / valuer's report supporting consideration
- Capital gains computation
- ITR (Income Tax Return) for the AY in which sale was made, showing capital gains
reported
- Form 26AS showing TDS deducted on consideration (if applicable)
- Bank credit advice showing receipt of sale proceeds
- Subsequent bank statements showing funds in [CLIENT_NAME]'s account from sale date
onwards
IF PRIMARY SOURCE IS SALE OF PROPERTY:
- Sale deed (registered, stamped)
- Earlier purchase deed (acquisition cost)
- Encumbrance certificate
- Capital gains computation (indexed cost / s.54/54EC reinvestment if claimed)
- ITR for sale year with capital gains schedule
- TDS by buyer (1% if consideration > INR 50 lakh - s.194-IA)
- Bank credit + subsequent retention
IF PRIMARY SOURCE IS SALARY + SAVINGS:
- Form 16 for each year contributing to savings (last 5-10 years)
- ITR for each year
- Form 26AS for each year
- Bank statements showing salary credits + savings build-up
- Employer letters / appointment letters showing role + salary progression
IF PRIMARY SOURCE IS INHERITANCE:
- Will (probated if applicable) OR succession certificate
- Death certificate of testator
- Deed of family settlement (if applicable)
- Bank statements showing transfer from deceased's estate to beneficiary
- Income from inherited assets reported in beneficiary's ITR
IF PRIMARY SOURCE IS INVESTMENT PORTFOLIO:
- Demat / mutual fund statements over relevant period
- Capital gains statements (short-term + long-term)
- ITRs reporting gains
- STT (Securities Transaction Tax) evidence
For [PRIMARY_FUND_SOURCE]: apply the relevant evidentiary track. Provide a one-page
"Source of Funds Memo" prepared by a Chartered Accountant tying ITRs + bank statements to
the funds being remitted.
§3 - 15CA / 15CB TAX CLEARANCE
Indian tax law requires Form 15CA (declaration by remitter) and (for amounts > INR 5 lakh
in a financial year) Form 15CB (CA certificate) for foreign remittances under Rule 37BB.
FORM 15CA Part A: remittances <= INR 5 lakh in current FY - self-declaration
FORM 15CA Part B: > INR 5 lakh AND covered by lower-rate certificate from AO
FORM 15CA Part C: > INR 5 lakh AND CA-certified 15CB
FORM 15CA Part D: not chargeable under Income-tax Act (e.g. gift to relative, return of
own capital, etc.)
For [TARGET_ROUTE] funding:
- Most cases: Part C with 15CB certificate from a Chartered Accountant
- 15CB certificate confirms: (a) nature of remittance, (b) applicability of DTAA (India-
Ireland DTAA exists), (c) tax deducted at source if applicable
- Filed online via Income Tax e-filing portal before remittance
- Bank requires 15CA acknowledgement number to process outward remittance
For LRS remittances categorised as "immigration" or "investment", banks typically accept
Part D or Part C depending on whether the funds have already been tax-cleared at source
(e.g. previously taxed business sale proceeds).
§4 - LIVE WORKED EXAMPLE FOR [CLIENT_NAME]
Build a 4-step plan:
STEP 1: Documentation phase (4-6 weeks)
- Engage CA to prepare Source of Funds Memo tracing [PRIMARY_FUND_SOURCE] to current
bank position
- Pull ITRs + Form 26AS + Form 16/16A for last 5-7 AYs
- Obtain CA-certified copies; apostille for ISD submission
STEP 2: Tax clearance phase (1-2 weeks)
- File 15CA + obtain 15CB from CA for the outward remittance
- For multi-tranche remittance: separate 15CA per tranche; one 15CB can cover purpose
class
STEP 3: Bank execution phase (1-3 weeks)
- Authorised Dealer (AD) Category-I bank handles remittance under LRS / ODI
- Bank requires: 15CA + 15CB + Form A2 (LRS declaration) + KYC + source-of-funds proof
- For ODI: additionally Form FC + Form ODI + APR commitment
- Bank wires funds to Irish receiving account (typically a solicitor's client account
until Stamp 4 issued, then to Irish company / fund / investee)
STEP 4: Irish-side receipt + AML (1-2 weeks)
- Irish receiving bank conducts AML/KYC under Criminal Justice (Money Laundering and
Terrorist Financing) Act 2010
- Provides receipt confirmation
- Funds become available for deployment per [TARGET_ROUTE]
Total elapsed time: 8-12 weeks from CA engagement to Irish-side availability.
§5 - LRS-INSUFFICIENT-FOR-AMOUNT SCENARIOS
If [AMOUNT_EUR] > LRS cap and no Indian corporate ODI route:
OPTION A - Multi-year LRS planning
- Year 1 (current FY): remit up to USD 250k (approx EUR 230k)
- Year 2 (next FY): remit balance up to USD 250k
- Pre-position Year 1 funds in Irish solicitor client account; deploy when full amount
arrives
- ISD generally tolerant of staged funding for STEP if commitment is clear
- For IIP: full amount must be in place before grant of Stamp 4
OPTION B - Family-pooled LRS
- Spouse can also remit up to USD 250k per FY under own LRS
- Adult children (over 18) can also remit
- Pooled total can reach USD 1m / FY for a family of 4
- Each family member files own Form A2 + 15CA/15CB
- Funds ultimately consolidated in Irish receiving account
- DO NOT structure as concealed gift if not actually a gift - this is misrepresentation
OPTION C - Sale of foreign assets
- If client has existing offshore assets that were properly declared in Indian Schedule
FA + tax-compliant, those can be remitted to Ireland without LRS impact
- Documentation: Schedule FA filings, foreign tax returns, asset proof
OPTION D - ODI via Indian Pvt Ltd
- If No is "Yes": company can ODI up to 400% of net worth
- Indian company becomes parent of Irish subsidiary
- For [TARGET_ROUTE] = STEP: structure works only if STEP venture aligns with Indian
company's existing business (else it's a personal venture)
- For self-sponsored CSEP / GEP: works well; Indian Pvt Ltd capitalises Irish subsidiary;
client moves to Ireland as employee of Irish sub
- Filings: Form ODI, Form FC, APR annually
State which option fits [CLIENT_NAME]'s situation.
§6 - INDIAN TAX RESIDENCY TRANSITION
When [CLIENT_NAME] takes up Irish residence under [TARGET_ROUTE]:
- Indian tax residency: based on Income-tax Act s.6 (>=182 days in India in PY, or 60+182
rule for citizens)
- If client spends >=182 days in Ireland: Indian non-resident for that PY
- Conversion of Indian resident savings accounts to NRO accounts within "reasonable
period" per FEMA (typically 6 months of NRI status)
- NRE accounts can be opened for repatriable funds
- DTAA India-Ireland: relief from double taxation on Indian-source income (interest,
rent, capital gains)
- Schedule FA in Indian ITR: must declare foreign assets if any year of Indian residency
- Black Money Act 2015: harsh penalties for non-disclosure of foreign assets while
Indian-resident - do NOT conceal Irish company shares / Irish bank balances
§7 - RED FLAGS FOR ISD AML / SOURCE OF FUNDS REVIEW
- Funds appearing in client's account < 6 months before STEP / IIP application (recent
deposit without clear source = red flag; ideally show funds in client's hands for
12+ months)
- Cash deposits in Indian bank account (large cash unsupported by ITR)
- Loans from third parties (acceptable only if formally documented with terms +
interest + verifiable lender + lender's source of funds)
- Gifts from non-relatives (chargeable to tax under Indian Income-tax Act s.56(2)(x);
suspicious for AML)
- Funds routed via "hawala" or informal channels - immediate refusal + criminal exposure
- Funds from sanctioned jurisdictions or PEP-linked transactions
- Mismatch between declared income in ITRs and accumulated wealth
- Pending Indian Enforcement Directorate / Income Tax / GST proceedings
- Discrepancy between source-of-funds narrative and bank trail
§8 - INDIAN COMPANY SECRETARIAL HOUSEKEEPING (if applicable)
If using No = Yes for ODI:
- Board resolution authorising ODI
- ROC compliance up to date (annual filings, AGM minutes)
- Auditor's certificate confirming net worth
- Statutory auditor letter on ODI under MD-OI
- Filing of Form FC (within 30 days of remittance)
- Filing of Form ODI Part I + Part II as relevant
- APR (Annual Performance Report) filed each year for ongoing ODI
- UIN (Unique Identification Number) allocated by RBI for foreign entity
§9 - DOCUMENT PACK FOR ISD SUBMISSION
For source-of-funds component of [TARGET_ROUTE]:
(a) CA-certified Source of Funds Memo
(b) ITRs (full + acknowledgements) for last 5 AYs - apostilled
(c) Form 26AS for last 5 AYs
(d) Bank statements (Indian + any intermediate) for last 12-24 months - certified by bank
(e) Primary-source-specific evidence (SPA / sale deed / Form 16 / inheritance papers)
(f) Form 15CA + 15CB acknowledgements for the outward remittance
(g) Form A2 (LRS) or Form ODI / Form FC (ODI) acknowledgements
(h) AD bank's outward remittance confirmation (SWIFT MT103)
(i) Irish receiving bank's receipt confirmation
(j) For ODI route: Indian company audited financials + board resolutions + APR
undertakings
(k) Solicitor / immigration consultant cover note explaining the structure
§10 - RECOMMENDATION
State one of:
- PROCEED WITH SINGLE-FY LRS - amount fits within USD 250k cap; documentation phase 4-6
weeks
- PROCEED WITH MULTI-FY LRS - amount requires 2 financial years; plan accordingly
- PROCEED WITH FAMILY-POOLED LRS - if spouse/adult-child cooperation feasible
- PROCEED WITH ODI VIA INDIAN PVT LTD - if No = Yes and
structurally appropriate
- DEFER + REMEDIATE TAX COMPLIANCE - if Yes - all 5 years shows gaps; resolve before
initiating remittance (else 15CB will not issue)
- RECONSIDER ROUTE - source of funds insufficient or unverifiable
End with: "DRAFT source-of-funds + Indian remittance advisory - for Indian counsel (Chartered Accountant + FEMA specialist) + Irish solicitor joint review. Indian FEMA and tax law sit outside Irish-solicitor scope. ISD will not accept funds without complete chain-of-evidence; rushed remittance without 15CB / Form A2 / ODI compliance is a primary cause of STEP and IIP refusals. Verify current LRS cap, TCS rates, and Master Direction on Overseas Investment provisions before structuring."Unlock the vault to see the full prompt