How to Buy US Stocks from India
Three legal routes, the brokers that enable each, the LRS limit, and how the tax works. Educational, not advice.
The three legal routes
1. Direct US brokerage (via LRS)
RBI (LRS) + the US partner broker (SEC/FINRA, SIPC cover)Open a US-stocks account inside an Indian app (Groww, INDmoney, Vested, Dhan and others), remit rupees abroad under the RBI Liberalised Remittance Scheme, and buy real US-listed shares, often fractionally.
- + Buy almost any US-listed stock or ETF
- + Fractional shares, so small ticket sizes work
- + Real ownership of the underlying share
- - Counts against the LRS limit
- - 20% TCS applies above the yearly threshold (adjustable against tax)
- - Currency conversion and remittance costs
2. GIFT City / NSE IX (UDRs)
IFSCA (India’s GIFT City regulator), not SEBIOpen an IFSC trading and demat account (Motilal Oswal, HDFC Sky and others) at GIFT City and trade roughly 50 large-cap US names as Unsponsored Depository Receipts in US dollars on NSE International Exchange.
- + Indian-regulated, Indian-timezone settlement support
- + USD exposure without a foreign bank account
- + Curated set of the most-traded US large caps
- - Limited universe (around 50 names)
- - Still uses your LRS headroom
- - Newer route, fewer brokers
3. Feeder funds & international ETFs (INR)
SEBI (Indian mutual funds)Buy an Indian mutual fund or fund-of-funds that itself invests in a US index (for example a Nasdaq 100 or S&P 500 feeder), entirely in rupees through a normal Indian folio.
- + Rupee investment, no remittance or LRS paperwork
- + Simplest for SIPs and beginners
- + Professionally managed, diversified
- - Index or basket only, no single-stock picking
- - Industry-wide overseas investment limits can pause fresh inflows
- - Fund expense ratio on top of US costs
Where Indians buy US stocks - provider comparison
| Provider | Type | How it works | Min | Best for |
|---|---|---|---|---|
| Groww (US Stocks) | Indian broker, US arm | Buy US shares in-app under LRS; fractional investing. FX: In-app USD conversion · Fees: Flat per-trade plus an FX markup; check current schedule. | Low (fractional shares) | Existing Groww users wanting a simple start |
| INDmoney | Fintech (IFSCA regulated entity) | End-to-end INR to USD to US-market flow with SIPC cover on the US side. FX: Managed conversion at each step · Fees: Low/zero account fee, FX and withdrawal charges apply. | Very low (fractional) | Beginners wanting a guided, tracked flow |
| Vested | Fintech pioneer | Direct US investing with curated themed baskets (Vests). FX: In-app conversion · Fees: Free and premium tiers; FX markup applies. | Low (fractional) | Theme-based US portfolios |
| Dhan | Indian broker | US-stocks investing alongside the Indian trading account. FX: In-app conversion · Fees: Per-trade plus FX; check schedule. | Low | Active Indian traders adding US exposure |
| Motilal Oswal (GIFT City / IFSC) | IFSC broker | Trade US large caps as UDRs on NSE IX in USD via a GIFT City account. FX: USD on NSE IX · Fees: Brokerage on UDR trades; check schedule. | Per-UDR price | Investors preferring an India-regulated GIFT City route |
| HDFC Sky (GIFT City / IFSC) | IFSC broker | GIFT City access to US names as depository receipts in USD. FX: USD on NSE IX · Fees: Per current schedule. | Per-UDR price | HDFC ecosystem users |
Fee and FX details change often - confirm the current schedule on each provider before opening an account.
The LRS limit & TCS
Under the RBI Liberalised Remittance Scheme (LRS), a resident individual can remit up to 250,000 US dollars per financial year for permitted purposes including buying foreign shares. Remittances above the yearly threshold attract Tax Collected at Source (TCS), which is not an extra cost - it is adjustable against your income-tax liability or refundable. Each family member has their own LRS limit.
How US stocks are taxed
High level only, not tax advice. Gains on US shares are taxed in India: holdings sold after 24 months are long-term, shorter holdings are short-term and taxed at your slab. US dividends face US withholding tax, for which India allows a credit under the India-US tax treaty so you are not taxed twice. Foreign shares and accounts must be disclosed in Schedule FA of your Indian income-tax return regardless of gain or loss. Consult a qualified tax professional for your situation.
FAQ
What is the LRS limit for buying US stocks?
Under the RBI Liberalised Remittance Scheme (LRS), a resident individual can remit up to 250,000 US dollars per financial year for permitted purposes including buying foreign shares. Remittances above the yearly threshold attract Tax Collected at Source (TCS), which is not an extra cost - it is adjustable against your income-tax liability or refundable. Each family member has their own LRS limit.
How are US stocks taxed for Indian investors?
High level only, not tax advice. Gains on US shares are taxed in India: holdings sold after 24 months are long-term, shorter holdings are short-term and taxed at your slab. US dividends face US withholding tax, for which India allows a credit under the India-US tax treaty so you are not taxed twice. Foreign shares and accounts must be disclosed in Schedule FA of your Indian income-tax return regardless of gain or loss. Consult a qualified tax professional for your situation.
Which is better, a direct US account or GIFT City?
A direct US-stocks account gives access to almost any US-listed share with fractional investing, but uses your LRS limit and involves remittance. GIFT City gives an India-regulated route to a curated set of US large caps as depository receipts in dollars. Beginners often start direct or with a feeder fund; GIFT City suits those who prefer an India-regulated wrapper.
Are feeder funds simpler than buying US shares directly?
Yes, for many people. A rupee feeder fund or international ETF lets you invest in a US index without remittance, LRS paperwork or US tax filing complexity, though you give up single-stock selection and pay the fund expense ratio.
Educational and informational only. Downstox is not a SEBI-registered investment adviser. US securities involve currency, regulatory and market risk. Verify every figure and your own LRS/tax position before acting.