Should i have to disclose the source of my earnings to the bank

I have started forex trading few months ago. i opened the account at oanda(US broker).
i funded the account through paypal with the creditcard. i have made some good profits.
Now i wish to withdraw the profits to my bank account. The profits are above Rs.1.5 lacs so it is a taxable figure.

Now, i have read many posts in this forum about the legality of trading in forex by a resident indian.:annoyed:


It is mentioned in the "Liberalised Remittance Scheme (LRS) of USD 200,000" that

"The remittance facility under the Scheme is not available for
ii) Remittance from India for margins or margin calls to overseas exchanges / overseas counterparty;
iv) Remittance for trading in foreign exchange abroad;"

I didn't kown about this when i invested.:sos:

The Above 2 circulars say that one cannot remit from india to abroad for forex trading using LRS.

But there is nowhere mentioned that an resident indian cannot trade FOREX, so what alternatives are available?



Also many questions to ask.

1) suppose i get to open an account in dubai and have a friend working in dubai to deposit some money into my dubai account and then i use wire transfer to transfer money from my dubai account to my trading account in U.S. This way i am not using the LRS. so im not breaking any rules. What do you people think about this idea?:!


2)If i withdraw the investment into the bank account, will the income tax/bank ask me where the money has come from?And if they ask me then what should be my legally correct answer? I haven't withdrawn any money yet.

3)Also if i withdraw USD 2000 every month into my bank account through paypal will i have to show the source of money comming into my paypal account to the income tax.

If you send via Paypal to your local bank.Then i think Income tax people should not have any issues with that.Cause if you notice in time of withdrawing money from paypal to local bank.We need to select purpose option,for what i am withdrawing it.Then I feel,we are already stated about your earning from where its coming and for what purpose.So there should not be any issue after that.I hope i am right.

And if you pay taxes correctly,i think there will not be any trouble.Cause at least we will not be out of any law.
This is just my view about the point.
For more confirmation,consult with good tax consultant.They have better plans.

Regards.

u sold sex videos online ? if u used paypal to withdraw to bank.

Thanks for your answer but i want to know how you withdraw your money.

what does it suppose to mean?

if u fund fxdd with paypal and withdraw profits to paypal

then paypal to bank

how the hell does the bank know what u did online

so you mean while paying tax i only need to show the transaction in bank account?
if i show my profit as "business investment" will the IT people ask what kind of investment?

tell them u sold sex videos of 2 dogs online :lol:

The banks like ICICI Bank don't ask you for the source of funds if the funds are received in your savings account. If you receive funds in a business account (current account) then every bank will want to know what the source of funds is because they have to issue FIRC (Foreign Inward Remittance Certificate) for each wire transfer.

If you withdraw from Paypal account to your personal savings account, then the funds are received in Indian Rupees. Once you have withdrawn a certain amount from your Paypal account to your savings account, paypal will ask you to enter your PAN number and will most likely report further transactions to indian Income tax department.

Dear Startrade

Thankyou for the the information you have shared. But i wish to you to suggest a way so that i can withdraw my money and go unnoticed from the IT. Unnoticed means that i want to pay the tax but they should not fine me for margin trading and also what is the limit i can withdraw from paypal after which paypal will let the IT know about my transactions.

Waiting for you reply.