Indian residents can legally invest in US stocks under the RBI’s Liberalised Remittance Scheme (LRS), which permits remitting up to $250,000 per financial year for permitted overseas investments. Owning a piece of Apple, Tesla, or Microsoft is no longer out of reach for Indian residents. The regulatory framework has opened up, and the routes have multiplied. But the mechanics of investing abroad differ from buying Reliance or HDFC Bank on the NSE, and the tax treatment differs too.
The Liberalised Remittance Scheme lets a resident individual send up to $250,000 abroad in a financial year, and foreign securities sit within that allowance. Stay inside the cap and no separate approval is needed. Only individuals can use it, which rules out corporate entities, HUFs, and trusts.
the three main routes
There is no single route that works for everyone. Convenience, cost, and how much control you want over the underlying shares pull in different directions.
Route 1: Indian brokers with US tie-ups. ICICI Direct, HDFC Securities, Axis Securities, and a few discount brokers have built access to NASDAQ and NYSE through partnerships with registered American brokers. The process is familiar: open an international trading account, complete KYC, remit dollars under LRS, and buy. Brokerage and forex conversion charges tend to run higher than domestic equity trades, which is the main trade-off. For most retail investors, this is the first route they try.
Route 2: GIFT City IFSC via NSE IX Receipts. NSE International Exchange, an NSE subsidiary operating out of GIFT City, offers NSE IFSC Receipts. Market makers buy the actual US shares and issue receipts against them, so what is owned is a receipt tracking the share’s value rather than the share itself. Eight US stocks launched initially: Amazon, Tesla, Alphabet, Meta, Microsoft, Netflix, Apple, and Walmart. The plan is to expand to 50. Trading is in US dollars, fractional buying is allowed, and since one Tesla share equals 100 receipts, a fraction of a share is within reach. Sessions follow US market timings, roughly 8 PM to 2:30 AM IST.
Route 3: India INX Global Access. India INX, a BSE subsidiary, runs the Global Access platform, which covers over 80 international exchanges including the US. Indian brokers partner with US brokers, and the shares bought are actual US shares held through the foreign broker tie-up, with the transaction routed through the IFSC framework.
Approvals have also been granted to platforms like Zerodha, Groww, Angel One, and Upstox to enable international investing through GIFT City, with services expected after technology integration. MarketWolf partnered with Appreciate in September 2026 to offer US stocks through GIFT City as well.
the LRS mechanics
Whichever route is chosen, the money leaves India through LRS. Rupees are remitted through an authorised bank, converted to US dollars, and sent to the overseas brokerage account. The bank requires Form A2 and a declaration that the remittance is for investment purposes.
One detail worth remembering: funds sitting idle in an IFSC bank account for more than 15 days must be repatriated to the domestic INR account. Money cannot be parked in the overseas account indefinitely without being invested.
how US stocks are taxed in India
The tax treatment diverges from domestic equity in a way that catches many investors off guard. Shares listed only on foreign exchanges are treated as unlisted securities under Indian tax law.
Domestic listed equity qualifies as long-term after 12 months. US stocks take twice as long. The threshold is 24 months, and only past that point does the gain qualify as long-term, taxed at 12.5% without indexation. Sell earlier than 24 months and the gain is short-term, added to income and taxed at the applicable slab rate, which can climb to 30% for high earners.
Currency conversion adds another layer. Both the purchase cost and the sale proceeds must be converted to Indian rupees using the prescribed exchange rate. If the rupee depreciates during the holding period, the taxable gain in rupee terms will exceed the gain in dollar terms.
Dividends follow a separate path. The US withholds 25% if Form W-8BEN has been submitted establishing non-US status, and the dividend is also taxable in India at the applicable slab rate. Foreign Tax Credit prevents double taxation, but the credit is capped at the lower of the foreign tax paid or the Indian tax payable on the same income.
the reporting requirements
This part gets overlooked more than any other. A Resident and Ordinarily Resident taxpayer has to disclose all foreign assets in Schedule FA of the income tax return, whether or not gains were made that year. The overseas brokerage account itself counts as a foreign asset, and so does every foreign shareholding.
Income from these assets goes into Schedule FSI, and the Foreign Tax Credit claim goes into Schedule TR. Form 67 must be filed electronically before the return, and skipping it is the single most common reason FTC claims get rejected.
Schedule FA follows the calendar year, 1 January to 31 December, while the rest of the ITR follows the financial year, 1 April to 31 March. That mismatch means the income disclosed in Schedule FA will not always line up with what appears elsewhere. It is expected, and a working paper that maps the two periods makes the filing easier.
what retail investors should take from this
The routes exist, and they are legal. The complexity sits in the tax reporting and the holding period, not in the buying.
For someone starting small, the Indian broker tie-up is the simplest entry point. For someone planning to hold, the 24-month threshold for long-term capital gains is the key date to track. For anyone receiving dividends, Form W-8BEN and Form 67 stand between you and double taxation.
The LRS cap of $250,000 a year is generous enough for most retail portfolios. The binding constraint is not the cap. It is the discipline to report holdings correctly and hold long enough to qualify for the concessional rate.
Frequently asked Questions
1. Is it legal for Indian residents to invest in US stocks?
Yes. The RBI’s Liberalised Remittance Scheme allows a resident individual to send up to $250,000 abroad each financial year, and US stocks fall within that allowance. Stay inside the cap and no special approval is needed.
2. What is the holding period for long-term capital gains on US stocks?
24 months, not 12. US stocks are classified as unlisted securities under Indian tax law, which extends the long-term threshold. Gains realised after 24 months are taxed at 12.5% without indexation.
3. How are dividends from US stocks taxed in India?
Two layers apply. The US withholds 25% if Form W-8BEN has been submitted. India then taxes the same dividend at the applicable slab rate. Form 67, filed before the ITR, allows a Foreign Tax Credit to offset the US tax, capped at the lower of the two liabilities.
4. What is Schedule FA and do I need to file it?
Schedule FA is where ROR taxpayers disclose all foreign assets, including overseas brokerage accounts and US shareholdings. Filing is mandatory even in years when no gains were made. It follows the calendar year, not the financial year.
5. What is the GIFT City route for buying US stocks?
Two platforms operate under the IFSCA framework. NSE IX Receipts are derivative receipts tracking US shares, with fractional buying allowed. India INX Global Access routes trades through Indian brokers partnered with US brokers and results in actual US share ownership.
