Step one: the owner draw
A single-member LLC has no salary, no dividend, no board resolution, you take an owner draw: a transfer from the LLC's account to yours, recorded in the books as a distribution. Three rules make it clean: LLC account to your account (never LLC-to-someone-else's), label it ("owner draw / distribution" in the memo and your books), and draw profit, not float, leave enough for the company's own obligations. Remember the draw itself isn't the taxable event for you: India taxes the LLC's profit as it arises, whether or not you've moved a rupee.
Step two: pick the rail
| Rail | Real cost on $10,000 | Speed | Notes |
|---|---|---|---|
| Wise (LLC account → INR account) | ~$60-90 total, mid-market FX | Hours-2 days | The default answer; transparent pricing |
| Direct wire (Mercury → Indian bank) | Wire fee ~$0-25 + your bank's FX spread, often 1-2% ($100-200 hidden) | 1-3 days | The spread is the cost nobody itemizes |
| PayPal / cards | 3-4%+ | Fast | Wrong tool for owner transfers |
On $100k/yr of draws, the gap between Wise and a spread-heavy wire is roughly $1,000-1,500 a year, the single most bankable saving in this whole guide.
Step three: purpose codes and paperwork
Inward remittances to India carry an RBI purpose code chosen at receipt. It must describe what the money is, and for an owner draw from your foreign entity, that is a repatriation of business income/disinvestment proceeds from your overseas investment, not "family maintenance" or "gift" (miscoding into those categories is the classic self-inflicted wound). Your receiving bank may ask for the story once: LLC formation documents, source of funds, your ODI/Form FC trail from when you set the investment up correctly. Founders whose India-side paperwork exists sail through; founders who skipped it meet their bank's compliance desk at the worst possible moment.
Step four: the tax declaration
By the time money lands, the tax answer should already be decided: the LLC's profit went on your ITR as business income (slab rates, or via 44ADA where it fits), the LLC and its accounts are disclosed on Schedule FA, and in the standard no-US-tax pattern there's no foreign tax credit to claim, just Indian tax, paid through advance-tax instalments if the amounts are meaningful. The two-country tax guide covers the whole chain; the estimator gives you the number.
What to keep USD for
Repatriating everything is its own mistake if you have dollar expenses: US tax preparation, software, contractors, ads all cost 3-4% extra when paid from INR. Standard pattern: keep a working balance plus a compliance reserve in the LLC, sweep the rest home on a monthly or quarterly rhythm, regular medium-sized transfers beat one giant year-end wire for rate risk and for not looking odd to anyone's compliance systems.
The five expensive mistakes
- Paying personal expenses straight from the LLC card. Pierces your books and your liability shield at once. Draw first, spend personally second.
- Wrong purpose code ("gift", "family maintenance") on what is business income, miscoding is the thing that turns routine money into questions.
- Never repatriating and never declaring, the profit is taxable in India as it arises; letting it pile up undeclared in Mercury is a Schedule FA/Black Money Act problem compounding annually.
- Draining the account to zero and missing the LLC's own bills (agent renewal, tax prep, the state's annual fee).
- Paying 1-2% FX spread out of inertia, set up the Wise route once, save four figures a year forever.
