How to Invest in US Stocks from India in 2026

Global diversification is no longer just for institutional investors. For Indian retail investors, holding a portion of their wealth in US stocks (like Apple, Microsoft, Amazon, and NVIDIA) is a smart way to tap into global technology growth and hedge against the depreciation of the Indian Rupee.

However, investing across borders requires navigating specific foreign exchange regulations, tax codes, and brokerage procedures set by the Reserve Bank of India (RBI) and the Income Tax Department.

This guide outlines the rules for investing in US stocks from India in 2026, explains the LRS limits, decodes the TCS tax rules, and reviews the primary investment routes.

1. The LRS Framework: How Much Can You Invest?

All outbound investments from India are regulated by the RBI under the Liberalised Remittance Scheme (LRS).

The Limit: Under LRS, a resident Indian individual can legally remit (transfer) up to $250,000 USD (approximately ₹2.1 Crore) per financial year abroad for permissible capital and current account transactions, including purchasing stocks, ETFs, and properties.
Family Pooling: If you want to invest more, the limit applies per individual, meaning a family of four can pool their limits to remit up to $1,000,000 per year.

2. Tax Collected at Source (TCS) Rules (2026)

One of the most important tax rules to understand is the Tax Collected at Source (TCS) on foreign remittances. This was revised in recent budgets:

Remittances Up to ₹7 Lakhs: 0% TCS. If your total foreign remittances (including stock investments and travel) are under ₹7,00,000 in a financial year, no TCS is deducted.
Remittances Above ₹7 Lakhs: 20% TCS on the amount exceeding ₹7 Lakhs.
Note: TCS is not an additional tax. It is a withholding tax. The 20% deducted is credited to your PAN card. You can claim this amount as a refund or adjust it against your final tax liability when filing your annual Income Tax Return (ITR).

3. Investment Route 1: Direct US Brokerage Accounts

This is the most popular route for buying individual US stocks and ETFs.

How it Works: You open a trading account with an international brokerage platform (e.g. Vested, Indmoney, or Interactive Brokers).
The Funding Process: You must fund the account by initiating an LRS out-remittance through your Indian bank account. Banks charge a foreign exchange markup fee and a transfer fee (ranging from ₹500 to ₹1,500 per transaction).
Fractional Investing: The US stock market allows fractional share purchases, meaning you don’t need to buy a full share of Berkshire Hathaway or NVIDIA. You can invest as little as $1 (₹85) to own a fraction of a share.

4. Investment Route 2: International Mutual Funds in India

If you do not want the hassle of opening foreign brokerage accounts and dealing with bank wire transfers, you can buy international mutual funds managed by Indian AMCs.

How it Works: These funds collect money in INR and invest in US stocks or US-focused ETFs (e.g., Motilal Oswal Nasdaq 100 ETF, SBI S&P 500 Index Fund).
The Challenge (RBI Caps): The RBI has placed an industry-wide cap of $7 Billion on mutual fund overseas investments. Consequently, Indian AMCs periodically pause fresh subscriptions or SIPs into these international funds when the cap is reached. Check with your fund house to confirm subscription status.

5. Taxation on US Stocks in India

Gains on US stock investments are taxed under foreign asset rules:

Short-Term Capital Gains (STCG): If held for less than 24 months, gains are added to your income and taxed at your marginal slab rate.
Long-Term Capital Gains (LTCG): If held for 24 months or longer, gains are taxed at 12.5% without indexation (standard updated rates).
Dividends: Dividends paid by US companies are subject to a 25% US tax deduction at source. Under the Double Taxation Avoidance Agreement (DTAA), you can claim a tax credit for this 25% US tax when filing your ITR in India.

To model US stock returns or compare them against bank CD yields, check out: