How to Invest in US Stocks from India: 2026

“Mani, I moved back to India last year. But I still want to keep investing in Apple, Google, and some S&P 500 ETFs. How do I do that legally from India?”

I get this question at least once a week in our WhatsApp groups.

And honestly, it’s a smart question. If you’ve spent years in the US building wealth through your 401(k) or brokerage accounts, you already know the power of American markets.

The good news? You can absolutely invest in US stocks while sitting in India.

The process is easier than it was even two years ago. But there are rules, taxes, and hidden costs that most platforms don’t tell you upfront.

Let me walk you through everything – from the legal framework to the exact platforms, step-by-step process, and the tax implications you need to understand.

Why Invest in US Stocks from India?

Before the “how,” a quick word on the “why.”

If you’ve returned to India from the US, you already understand the value of US markets. But even for those who never lived abroad, there are solid reasons.

Geographic diversification.

India’s stock market is great. But having all your money in one country’s market is risky. The US market gives you exposure to the world’s largest companies across tech, healthcare, energy, and finance.

Currency hedge.

The Indian Rupee has historically depreciated against the US Dollar. In 2015, 1 USD was about ₹65. Today it’s around ₹91. That’s a 40% depreciation. Investing in USD-denominated assets protects your purchasing power.

Access to innovation.

Companies like Apple, Microsoft, Nvidia, Amazon, Alphabet, and Tesla are listed in the US. Many of these companies earn revenue globally and represent the cutting edge of AI, cloud computing, and biotech.

Historical returns.

The S&P 500 has returned roughly 10% annually over the long term. When you add the rupee depreciation, the INR-adjusted returns for an Indian investor have been even higher.

That said – US stocks aren’t guaranteed returns. Markets go through downturns. This is about long-term diversification, not get-rich-quick speculation.

The Legal Framework: RBI’s Liberalised Remittance Scheme (LRS)

Here’s the foundation you need to understand first.

The Reserve Bank of India allows Indian residents to invest up to USD 250,000 per financial year (April to March) under the Liberalised Remittance Scheme (LRS).

This ₹2+ crore annual limit covers all overseas remittances – investments, education, travel, gifts, and maintenance. It’s cumulative, not per-category.

A few important rules:

• Only resident individuals can use LRS. HUFs and companies cannot.
• You need a PAN card and an Aadhaar-linked bank account.
• Your bank processes the remittance after standard KYC and Form A2.
• Only delivery-based investing is allowed. No intraday trading, no futures, no options in US markets.
• You must specify the correct purpose code when remitting.

If you’re unsure about purpose codes for remittances, we have a detailed guide that explains each one.

TCS: Tax Collected at Source on Remittances

This is where many people get confused.

When you remit money abroad under LRS for investments, Tax Collected at Source (TCS) applies.

As per the 2025-26 budget:

Remittance Amount	TCS Rate
Up to ₹10 lakh per financial year	0% (No TCS)
Above ₹10 lakh	20% on the amount exceeding ₹10 lakh

Important: TCS is NOT an additional tax. It’s an advance tax payment that gets adjusted when you file your Income Tax Return (ITR). You can claim it back as a refund or set it off against your tax liability.

But it does lock up your money temporarily. If you’re sending ₹20 lakh abroad, ₹2 lakh (20% of the ₹10 lakh above the threshold) gets collected as TCS.

For those interested in understanding the broader TCS rules on remittances, our guide breaks it down with examples.

4 Ways to Invest in US Stocks from India

You have four main routes. Each has different costs, complexity, and control levels.

Method 1: Direct Investing Through Indian Platforms

This is the most popular method in 2026.

Indian fintech platforms partner with US brokers to give you access to US stock exchanges (NYSE and NASDAQ). They handle the LRS paperwork, currency conversion, and compliance.

How it works:

1. Download the app and complete KYC (PAN, Aadhaar, address proof)
2. Open a US investing account (takes 10-30 minutes)
3. Link your Indian bank account
4. Transfer INR – the platform converts to USD under LRS
5. Browse and buy US stocks or ETFs
6. Many platforms offer fractional shares (invest as little as $1)

Popular platforms:

Platform	Brokerage Fee	Forex Markup	Min. Investment	US Broker Partner	Key Strength
INDmoney	Zero	~1%	$1	DriveWealth / Alpaca	All-in-one super app
Vested Finance	Zero (Basic plan)	1.5-2%	$1	DriveWealth (VF Securities)	Curated thematic portfolios
Groww	$0.02/trade	~1%	$1	Alpaca Securities	Simple interface
Fi Money	Zero	~1%	$1	Alpaca	Banking + investing combo

Pros: Easy to use, handle LRS compliance, fractional shares, SIP options, tax reports available.

Cons: Forex markup costs add up, withdrawal fees ($5-11), limited to US stocks only (no European markets), platform risk if they shut down operations.

My take: INDmoney and Vested are the most popular in our community. INDmoney works well if you want a single app for Indian and US investments.

Vested is better if you’re specifically focused on building a US portfolio with their curated “Vests” (thematic baskets).

Method 2: Direct Investing Through International Brokers

For experienced investors who want more control, lower costs, and access to global markets beyond just the US.

Popular options:

Broker	Best For	Forex Cost	Min. Balance	SIPC Protection
Interactive Brokers (IBKR)	Advanced traders, lowest costs	~0.2%	None	Yes, up to $500K
Charles Schwab International	Long-term investors	~0.5%	$25,000	Yes, up to $500K

How it works:

1. Open an account directly with the international broker
2. Complete their verification process (passport, proof of address)
3. Sign the W-8BEN form (declares you’re a non-US person for tax purposes)
4. Wire money from your Indian bank under LRS
5. Trade directly on US exchanges

Pros: Lowest overall costs, access to global markets (US, Europe, Asia), advanced tools, professional-grade platform, multi-currency accounts.

Cons: Higher learning curve, wire transfer fees from Indian banks (₹500-2,000 per transfer), complex tax reporting, KYC process takes longer.

My take: Interactive Brokers is hands down the best option for serious investors. Their forex markup is just 0.2%, which is 5-10x cheaper than Indian platforms. But the interface isn’t beginner-friendly.

If you’ve used Robinhood or Schwab in the US, you’ll adapt quickly. If you’re new to investing, start with an Indian platform first.

Method 3: Indian Mutual Funds with US Exposure (Indirect)

This is the easiest route. No LRS paperwork, no foreign account, no currency conversion headaches.

Indian Asset Management Companies (AMCs) offer mutual funds and ETFs that invest in US markets. You buy and sell these in INR through your regular mutual fund apps.

Popular funds:

Fund	Tracks	Expense Ratio	Available On
Motilal Oswal S&P 500 Index Fund	S&P 500	~0.49%	Zerodha, Groww, Paytm Money
Motilal Oswal Nasdaq 100 ETF	Nasdaq 100	~0.58%	Zerodha, Groww
Mirae Asset NYSE FANG+ ETF	FANG+ Index	~0.75%	Zerodha, Groww
Franklin India Feeder US Opportunities	US Growth stocks	~1.5%	Most platforms

Pros: No LRS needed, no TCS, simple INR-based investing, SEBI regulated, available through your existing broker.

Cons: Higher expense ratios (0.5-1.5%), SEBI has an industry-wide $7 billion overseas investment cap (funds can pause inflows when cap is hit), you don’t own the stocks directly, taxed differently than direct US stocks.

Tax treatment for these funds:

• Held > 24 months: LTCG at 12.5% (no indexation)
• Held ≤ 24 months: STCG at your income tax slab rate
• Treated as non-equity (debt fund) taxation

My take: This is perfect for beginners and for people who just want simple S&P 500 or Nasdaq exposure without dealing with LRS paperwork.

The SEBI overseas cap is the main risk – some funds have paused new inflows in the past when the cap was reached.

Method 4: GIFT City (NSE IFSC) – The New Route

This is the newest option and it’s evolving quickly.

GIFT City in Gujarat houses India’s International Financial Services Centre. Through NSE IFSC, Indian investors can buy Unsponsored Depository Receipts (UDRs) of around 50 top US companies.

Available companies include: Apple, Amazon, Alphabet (Google), Microsoft, Meta, Tesla, Netflix, Walmart, Berkshire Hathaway, JPMorgan, Mastercard, Nike, PayPal, Pfizer, and more.

How it works:

1. Open a trading + demat account with an IFSCA-regulated broker
2. Fund your account under LRS
3. Buy UDRs that represent fractions of US shares
4. Trading happens during US market hours (7 PM to 1:30 AM IST)
5. Settlement follows T+3 cycle

Pros: No STT (Securities Transaction Tax), no stamp duty, IFSCA regulated, fractional ownership built-in, receipts held in your own GIFT City demat account.

Cons: Limited to ~50 stocks (only S&P 500 companies), lower trading volumes, still requires LRS for funding, fewer brokers available, relatively new system.

My take: GIFT City is promising but still maturing. If you only want to invest in blue-chip US companies and prefer an India-based regulated framework, it’s worth exploring.

But for broader access (thousands of stocks, ETFs, sector funds), direct platforms or international brokers are better.

Step-by-Step: How to Start Investing (The Practical Guide)

Let me walk you through the most common path – using an Indian platform like INDmoney or Vested.

Step 1: Gather your documents

• PAN card
• Aadhaar card
• Indian bank account (with net banking)
• Passport (for address/identity verification)
• A selfie (for digital KYC)

Step 2: Open your US investing account

Download the app, sign up, and complete KYC. Most platforms verify your identity within hours.

You’ll also sign a W-8BEN form digitally.

This form tells the US government that you’re a non-US person. Without it, US dividend withholding jumps from 25% to 30%.

Step 3: Transfer funds

Link your Indian bank account. When you initiate a transfer, the platform handles the LRS paperwork and currency conversion.

First ₹10 lakh in a financial year – no TCS. Beyond that – 20% TCS (claimable in your ITR).

Transfer typically takes 1-2 business days.

Step 4: Buy your first stock or ETF

Search by company name or ticker symbol (AAPL for Apple, MSFT for Microsoft, SPY for S&P 500 ETF).

Choose between market order (buy at current price) or limit order (buy when price drops to your target).

Many platforms allow fractional shares – so you can buy $100 worth of a $200 stock.

Step 5: Monitor and manage

US markets operate from 9:30 PM to 4:00 AM IST (during US Daylight Saving) or 8:00 PM to 2:30 AM IST (November to March).

You don’t need to trade during these hours. Place limit orders anytime.

Step 6: Withdraw when needed

When you sell stocks, the USD amount sits in your brokerage wallet. To bring it back to India, initiate a withdrawal.

Money typically reaches your Indian bank within 3-7 business days.

Withdrawal fees range from $5 to $11 depending on the platform.

Taxation: The Part Nobody Wants to Read (But Must)

This is crucial. Getting this wrong can mean penalties, notices, and unnecessary double taxation.

Capital Gains Tax in India

The US does NOT tax capital gains for non-resident aliens (that’s you, as an Indian resident). So capital gains are only taxed in India.

Type	Holding Period	Tax Rate	Exemption
LTCG (Long Term)	More than 24 months	12.5% flat (no indexation)	None – even ₹1 of LTCG is taxable
STCG (Short Term)	24 months or less	Your income tax slab rate	None

Key point: The ₹1.25 lakh LTCG exemption under Section 112A does NOT apply to US stocks. That exemption is only for Indian-listed equities where STT is paid. Every rupee of LTCG on US stocks is taxable at 12.5%.

Dividend Tax

This is where things get tricky because of double taxation.

1. US withholding: The US deducts 25% tax at source on dividends (with W-8BEN filed; 30% without).
2. India taxation: The same dividend is also taxable in India at your slab rate under “Income from Other Sources.”

To avoid paying twice, you claim a Foreign Tax Credit (FTC) under the India-US Double Taxation Avoidance Agreement (DTAA).

Here’s how: File Form 67 before filing your ITR.

This lets you claim the 25% US tax as a credit against your Indian tax liability on the same dividend income.

Example: You receive $1,000 in dividends. US withholds $250. In India, at 30% slab, your tax would be $300. After FTC of $250, you pay only $50 in India.

Currency Conversion for Tax Calculations

When computing gains for Indian tax purposes, you must convert USD to INR using the SBI TT Buying Rate on the last day of the month preceding the transaction.

Purchase price and sale price are each converted at the applicable SBI rate for their respective months. The gain in INR is then taxed.

This means currency movements directly impact your taxable gains in India, even if your USD gain was modest.

Mandatory Disclosures in Your ITR

This is where many people slip up and face penalties.

If you hold any foreign assets – even one share of Apple – you MUST:

1. File ITR-2 or ITR-3 (not ITR-1)
2. Fill Schedule FA (Foreign Assets) – declare all foreign stocks, even if you didn’t sell anything
3. Fill Schedule CG if you sold any stocks (Capital Gains)
4. Fill Schedule OS if you received dividends (Other Sources)
5. File Form 67 before your ITR if claiming DTAA relief on dividends

Non-disclosure can lead to penalties under the Black Money Act – up to ₹10 lakh fine for foreign assets above ₹20 lakh.

This isn’t optional. Even if your portfolio is worth just $500, Schedule FA is mandatory.

For a detailed walkthrough on filing, check our guide on ITR filing for NRIs.

The US Estate Tax Trap (Most People Don’t Know This)

Here’s something that almost no Indian platform tells you.

If an Indian resident holds US-situs assets (US stocks, US ETFs, US-domiciled mutual funds) worth more than USD 60,000 and passes away, the US government can levy an estate tax of up to 40% on those assets.

Yes, 40%. And the India-US DTAA does NOT cover estate tax.

This means your family could lose a significant portion of your US investments in a worst-case scenario.

How to avoid this:

1. Ireland-domiciled UCITS ETFs – Funds like iShares Core S&P 500 UCITS ETF (CSPX) track the same US index but are domiciled in Ireland. They’re not US-situs assets, so no estate tax. Plus, dividend withholding is only 15% (vs 25% for US ETFs). Available through Interactive Brokers or Paasa.
2. Indian mutual funds with US exposure – Motilal Oswal S&P 500 Fund, for example. Since you hold Indian mutual fund units (not US stocks), there’s no US estate tax.
3. Keep direct US holdings under $60,000 – If your direct US stock/ETF portfolio stays below this threshold, estate tax doesn’t kick in.

This is relevant only if your total US portfolio is growing significantly. For someone investing $5,000-10,000, it’s less of an immediate concern. But plan ahead.

Costs Breakdown: What You Actually Pay

Let’s be honest about the total cost of investing in US stocks from India.

Cost Component	Indian Platform (e.g., INDmoney)	International Broker (e.g., IBKR)	Indian Mutual Fund
Account opening	Free	Free	Free
Brokerage	Zero to $0.02/trade	$0-1/trade	Zero
Forex markup	0.75-2%	0.2%	None (handled by AMC)
Wire/transfer fee	Included	₹500-2,000/transfer	None
Withdrawal fee	$5-11	$0-10	None
Expense ratio	N/A	N/A	0.5-1.5% annually
TCS (above ₹10L)	20% (refundable)	20% (refundable)	None
Annual maintenance	Free to $9.99/month (premium)	Free	Free

The real cost killer is forex markup.

On a $10,000 investment through an Indian platform with 1.5% markup, you pay $150 just on conversion. With Interactive Brokers at 0.2%, that’s only $20.

Over 10 years of regular investing, this difference compounds significantly.

Common Mistakes to Avoid

From what I’ve seen in our community, these are the most frequent errors.

1. Not filing Schedule FA

Even if you bought one share and didn’t sell it, you must disclose foreign assets. The penalty for non-disclosure is severe.

2. Forgetting Form 67 for dividend tax credit

If you don’t file Form 67 before your ITR, you lose the DTAA benefit. You’ll essentially pay tax twice on dividends.

3. Ignoring forex impact on tax calculation

Your actual USD gain and your taxable INR gain can be very different because of currency movements. Many people calculate gains in USD and forget to convert properly.

4. Treating US stock gains like Indian stock gains

The ₹1.25 lakh LTCG exemption and the 20% STCG concessional rate (Section 111A) apply ONLY to Indian-listed securities where STT is paid. US stocks get 12.5% LTCG (flat, no exemption) and slab rate STCG.

5. Not considering US estate tax

If your portfolio grows past $60,000, you need a plan. UCITS ETFs or Indian mutual funds can solve this.

6. Over-concentrating in US tech

Many Indian investors buy only Apple, Google, Tesla, and Nvidia. That’s not diversification – that’s a tech bet. Consider broader ETFs like SPY (S&P 500) or VTI (Total US Market) for true diversification.

7. Panicking during time zone gaps

US markets trade while India sleeps. A crash at 2 AM IST can trigger panic selling. Long-term investors should set limit orders and avoid checking prices at midnight.

For NRIs: Special Considerations

If you’re currently in the US on an H1B, L1, or other work visa and plan to return to India, here’s what matters.

Before you return:

• You likely already have a US brokerage account (Schwab, Fidelity, Robinhood). Check whether they allow non-resident (NRA) accounts after you become a non-resident. Many do, but some restrict features.
• Interactive Brokers is the most NRI-friendly US broker. They support non-resident accounts globally.
• Consider your 401(k) options before moving. Rolling over into an IRA might give you more investment flexibility.

After you return:

• Your US bank accounts and brokerage accounts don’t automatically close. But you MUST update your address and tax status.
• You’ll need to file US tax returns even after returning, if you have US-source income (dividends, capital gains from US stocks).
• FBAR reporting is required if your aggregate foreign (including US) account balances exceed $10,000 at any point during the year. Yes, even after you’ve returned to India, if you still hold US accounts.
• On the India side, once you become a resident, your worldwide income is taxable. Report everything in your ITR.

What I’d Recommend (If I Were Starting Today)

I’m not a financial advisor, so this isn’t investment advice. But here’s how I’d think about it based on what I’ve learned from our community.

If you’re a beginner or want simplicity:

Start with an Indian mutual fund tracking the S&P 500 (like Motilal Oswal S&P 500 Index Fund). No LRS headaches, no foreign account compliance, no TCS. Just SIP and forget.

If you want direct ownership and control:

Use INDmoney or Vested to start. Once your portfolio crosses ₹10-15 lakh, consider moving to Interactive Brokers for lower costs.

If you’re investing large amounts (₹50 lakh+):

Interactive Brokers directly. Consider Ireland-domiciled UCITS ETFs (CSPX, VWRA) instead of US-domiciled ETFs to avoid estate tax and get lower dividend withholding.

If you want the India-regulated route:

Explore GIFT City through an IFSCA-registered broker. Limited to 50 stocks, but zero STT and a growing ecosystem.

Regardless of which route you choose:

• Start small. Test with $100-500.
• Diversify. Don’t put everything in 3 tech stocks.
• Think long term. 5+ year horizon minimum.
• Start investing systematically through SIPs, not lump sums.
• Keep records meticulously for tax filing.
• Consult a CA who understands cross-border taxation.

Quick Reference: Documents and Forms Checklist

Here’s everything you’ll need across the investing and tax filing process.

For opening an account:

• [ ] PAN card
• [ ] Aadhaar card
• [ ] Indian passport
• [ ] Indian bank account with net banking
• [ ] Cancelled cheque or bank statement

For LRS remittance:

• [ ] Form A2 (your bank provides this)
• [ ] Purpose code declaration
• [ ] PAN verification

For US tax compliance:

• [ ] W-8BEN form (signed digitally through your broker)

For Indian ITR filing:

• [ ] ITR-2 or ITR-3 form
• [ ] Schedule FA (Foreign Assets declaration)
• [ ] Schedule CG (Capital Gains, if sold)
• [ ] Schedule OS (Other Sources, for dividends)
• [ ] Form 67 (for DTAA tax credit on dividends)
• [ ] Schedule TR (Tax Relief for foreign tax credit)
• [ ] Broker statements (annual/transaction-wise)
• [ ] Bank remittance proofs

Frequently Asked Questions

Q: Can I invest in US stocks if I’m an NRI living in the US?

Yes. NRIs can invest through US brokers directly (no LRS needed since you’re remitting from the US). You can also invest through GIFT City. However, Indian-platform LRS-based investing is only for Indian residents.

Q: Is there a minimum amount to start?

Many platforms allow investing from just $1 thanks to fractional shares. Realistically, start with at least $100-500 to make it worthwhile after fees.

Q: Can I do SIPs in US stocks?

Yes. INDmoney and some other platforms offer SIP (Systematic Investment Plan) options for US stocks and ETFs. You can set up weekly or monthly auto-investments.

Q: What happens if my Indian platform shuts down?

Your stocks are held with the US custodian/broker (like DriveWealth or Alpaca), not the Indian platform. They’re protected by SIPC insurance up to $500,000. You’d need to transfer your holdings to another broker.

Q: Should I invest in individual stocks or ETFs?

For most people, ETFs (like SPY, QQQ, or VTI) are better. They give you instant diversification. Individual stock picking requires significant research and carries higher risk.

Q: I already hold US stocks from my time in the US. Do I need to do anything special after returning to India?

Yes. Update your broker about your change of residency. Start reporting these holdings in Schedule FA of your Indian ITR. Review FBAR requirements. And consider the estate tax implications if your US holdings exceed $60,000.

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Investing in US stocks from India has genuinely become straightforward. The platforms are user-friendly, the regulatory framework is clear, and the benefits of global diversification are real.

Just make sure you understand the tax obligations. That’s where most people trip up.

If you’re planning your return to India and have questions about managing your investments during the transition, join our WhatsApp community at https://backtoindia.com/groups. 20,000+ NRIs share real experiences, platform recommendations, and CA contacts for cross-border tax filing. It’s free and volunteer-run.

Disclaimer: This article is for informational purposes only and does not constitute investment or tax advice. Investment in US stocks involves market risk, currency risk, and regulatory considerations. Tax rules can change. Always consult a SEBI-registered financial advisor and a qualified Chartered Accountant before making investment decisions. Verify current rates, fees, and regulations directly with the platform or authority concerned.