What is ttbr and ttsr?

TTSR (of the foreign currency initially utilised for the purchase of. Hello What is the full form of TTBR in capital gain and what does it. 14 September 2009 TTBR (telegraph Transfer Buying rate) Telegraphic transfer buying/selling rate in relation to a foreign currency is a rate of exchange adopted by the State Bank of India for purchasing/selling such currency where such currency is made available by that bank through telegraphic transfer. Under the India income tax law, exchange rate for conversion of income earned in foreign currency into Indian rupees is the telegraphic transfer buying rate (TTBR) issued by State Bank of India. What does Ttbr stand for? Hop on to get the meaning of Ttbr. (a), in respect of income chargeable under the head "Salaries", the last day of the month immediately preceding the month in which the salary is due, or is paid in.

Profits resulting from the sale or transfer of capital assets are considered as income under the capital gains heading. Section 48 of Income Tax Act, 1961 accounts for the expenses involved in the acquisition, repair and maintenance of such capital assets.

As mentioned above, the Section 48 of the Income Tax Act is aimed at computing the real capital gain upon the sale of capital assets. You can arrive at the real capital gain by accounting for the cost spent by the seller in acquiring said capital asset, sales consideration costs and costs associated with making improvements to the capital asset. These are the kinds of expenses that are allowed under Section 48 of the Income Tax Act:

The 1st Proviso to Section 48 of the Income Tax Act is applicable for non-resident Indians only. Sec 48 of the Income Tax Act becomes applicable when a non-resident buys an asset like a share or debenture with foreign currency, which is then converted into the INR as the security that is being purchased is to be paid for in INR.

When such a share or debenture is sold, it is sold to the seller in INR. According to the First Proviso to Section 48, this amount is to be reconverted into the original foreign currency. Thus, the first Proviso to Section 48 of Income Tax Act helps non-resident Indians to neutralise the exchange rate fluctuation and navigate the currency conversion rates while accounting for long term capital gains. Taxpayers can arrive at their final consideration value by following provisions of Rule 115A.

Here are some of the benefits of the First Proviso to Section 48 of the Income Tax Act in line with Rule 115A:

The Second Proviso of Section 48 of Income Tax Act offers indexation benefits to taxpayers who have realised long term capital gains upon sale or transfer of any long term capital asset (LTCA). Unlike the First Proviso, the Second Proviso is not applicable to non-resident Indians.

Resident individuals can calculate their total income that’s taxable under the heading - capital gains by accounting for indexed cost of the improvement and indexed acquisition cost. The cost incurred while making improvements and  modifications to the asset can be claimed as a deduction.

The Third Proviso under Section 48 of Income Tax Act states that the First and Second Proviso will not be applicable when Rule 112A is being taken into account.

According to the Fourth Proviso of Section 48 of Income Tax Act, the Second Proviso will not be applicable in the event that the capital gains arise from the sale or transfer of long-term capital assets when such assets are debentures or bonds except in the case of:

The Fifth Proviso under Section 48 of IT Act is applicable to eligible non-resident assessees. In the event that capital gains arise as a result of depreciation of foreign currency or appreciation of INR against any given foreign currency at the time of maturity of INR-denominated bonds, taxpayers can safely ignore these capital gains while calculating their total consideration value.

In case of transfer of debentures and shares as indicated in Section 47(iii) of the Income Tax Act happens in the form of a present or a gift, then the Sixth Proviso will come into force. As a taxpayer, you can safely consider the market value of these debentures and/or shares on the date of the transfer as their total consideration value.

Taxpayers can’t claim deductions under the Section 48 of Income Tax Act while calculating their total taxable income under capital gains if the Securities Transaction Tax (STT) is applicable on the given transactions.

Maybe you’re an entrepreneur and need to pay a supplier overseas, or you want to transfer money to a family member studying abroad - whatever your reason for sending money to an international account, you need to understand how the exchange rate for the transaction is set.

In this guide, we'll clarify the difference between telegraphic transfer (T/T) buying and selling rates in a simple way. Let's jump right in.

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Let’s start at the beginning. A telegraphic transfer — which is also often called a TT, telex transfer, or a T/T bank payment — is a broad term for transferring money from one bank account to another - usually involving moving the money from one country to another, and often between different currencies.

If you’re sending money back to your home country, this payment might also be described as a remittance - but it’s basically the same thing.

When you look up the exchange rates used for TT payments, you’ll often come across a chart or set of figures which describe several different exchange rates. The ones we are interested in are telegraphic transfer buying (TTB) rates and telegraphic transfer selling (TTS) rates.

The TTB rate is the rate at which a bank will convert foreign currency sent to India, into INR. So this means that if a friend or family member sends you a remittance from abroad in foreign currency, the chances are that the rate applied to credit you INR will be the TTB rate.

This buy rate doesn’t apply only to telegraphic transfers. Here are some examples of other transactions that use it¹:

The selling rate is used when the bank is sending INR out of the country, and into a different currency.

So for example, if you’re looking to make an outward remittance from India, and send money from your INR account to someone with a bank account held in a different currency, you need to know the selling rate (TTS).

In general, the TT Selling rate is applicable for¹:

Each bank will have its own approach to setting the buying and selling rates. To be sure of the rate that’s applied to your TT payment, you need to ask the bank directly. However, you can see how the buying rate is calculated by looking at the terms and conditions of your bank.

Let’s take Union Bank of India, for example - one of the larger banks offering retail services.¹

The Union Bank of India terms clarify that the buying rate that’s used is calculated by taking the base rate and reducing it by the bank’s margin, which is set at 0.025% to 0.080%.

The calculation is rounded for ease, and this sets the buying rate applied. You can find the full details for Union Bank of India in the source linked below or here, or check out the terms and conditions of your own bank, to make sure you’re happy with the way the calculation is carried out for your TT payments.

If you’re new to telegraphic transfers, the terminology and processes can be a bit confusing. It’s a smart idea to read up to make sure you understand the way your money is being moved, and to make sure you’re getting the best deal.

Here are some resources that might help.

Like many financial transactions, telegraphic transfers arranged by traditional banks seem to be awash with acronyms and technical language. That can be overwhelming if you’re new to it. Use this simple guide, and the resources we have picked out, to do a bit of research. Knowledge, after all, is power.

And while you’re doing your homework, check out other options for making international payments. You don’t need a degree in finance to understand a specialist services like Wise. The process is designed to be safe and simple - and could save you money.

Banks and money transfer providers often give you a bad exchange rate to make extra profits on international transfers.

Wise is different. Its smart new technology skips hefty international transfer fees by connecting local bank accounts all around the world. Which means you can save up to 8x by using Wise rather than your bank when you send your money abroad.

If you want to give Wise a try to see for yourself how well it can work for you, sign up for a free account. Registration can be done online in minutes.

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Sources:

The income chargeable under the head “Capital gains” shall be computed, by deducting from the full value of the consideration received or accruing as a result of the transfer of the capital asset the following amounts, namely :—

(i) expenditure incurred wholly and exclusively in connection with such transfer;

(ii) the cost of acquisition of the asset and the cost of any improvement thereto;

(iii) in case of value of any money or capital asset received by a specified person from a specified entity referred to in section 45(4), the amount chargeable to income-tax as income of such specified entity under that sub-section which is attributable to the capital asset being transferred by the specified entity, calculated in the prescribed manner:

(Recently amended by Finance act, 2021)

For understand this amended clause, You can refer this below link

https://taxguru.in/income-tax/rationalisation-provision-transfer-capital-asset-partner-dissolution-reconstitution.html

First Proviso to section 48 read with rule 115A

Provided that in the case of an assessee,

Rule 115BA Method of conversion and Calculation of Capital gain Accodingly

Second Proviso to section 48 Indexation in case LTCG on transfer of LTC asset.

Third Proviso to section 48 first and second provisos shall not apply where section 112A apply.

Fourth Proviso to section 48

Second proviso shall not apply to the long-term capital gain arising from the transfer of a long-term capital asset, being a bond or debenture other than—

(a) capital indexed bonds issued by the Government; or

(b) Sovereign Gold Bond issued by the Reserve Bank of India under the Sovereign Gold Bond Scheme, 2015:

Fifth Proviso to section 48

An Assessee being a non-resident, Capital Gain arise on the account of Appreciation of rupee against a foreign currency (it means value of Foreign Currency is depreciated- therefore to give benefit to non-resident, this 5th proviso came into existence, so that they do not preclude themselves in investment in the Indian Stock Market) at the time of redemption of rupee denominated bond (RDB)of an Indian company held by him, shall be ignored for the purposes of computation of full value of consideration under this section.

Sixth Proviso to section 48- MV = Sale consideration

Where shares, debentures or warrants referred to in section 47(iii) are transferred under a gift or an irrevocable trust, the market value on the date of such transfer shall be deemed to be the full value of consideration received or accruing as a result of transfer for the purposes of this section.

Seventh Proviso to section 48 – No STT Allowed

No deduction shall be allowed in computing the income chargeable under the head “Capital gains” in respect of any sum paid on account of securities transaction tax

There are only Four Cases where Indexation benefit will not be available