PMS and AIFs for NRIs: The Rs 50 Lakh and Rs 1 Crore Tickets, and Whether They Beat a Mutual Fund

You have built up serious money in India, a few crore across NRE deposits, mutual funds and maybe some direct equity, and a relationship manager has started using two acronyms you half recognise: PMS and AIF. The pitch is seductive. A dedicated manager, a concentrated book, access to private deals and strategies the ordinary mutual fund investor cannot touch. The minimums are large, Rs 50 lakh for one and Rs 1 crore for the other, and the pitch frames that as a feature, a velvet rope that keeps the retail crowd out. What the pitch tends to skip is the fee drag, the tax treatment that swings from 12.5% to almost 43% depending on which structure you sign, and the awkward fact that if you live in the US or Canada most of these products will not even take your money. This guide is the part the brochure leaves out.

The 30-second answer: Portfolio Management Services (PMS) carry a SEBI minimum of Rs 50 lakh per client per strategy; Alternative Investment Funds (AIFs) carry a minimum commitment of Rs 1 crore. Both target HNI NRIs, not ordinary corpus-builders. PMS is taxed like direct holding: gains arise in your own hands per security, at 12.5% LTCG and 20% STCG on listed equity (before surcharge and cess), with TDS deducted. AIF Category I and II have Section 115UB pass-through, so income is taxed in your hands, with listed-equity LTCG rationalised to 12.5% from AY 2026-27. Category III is taxed at the fund level, often at the maximum marginal rate of about 42.7% (FY 2025-26), with the distribution then exempt in your hands. NRIs invest via a repatriable (NRE) or non-repatriable (NRO) route. US and Canada NRIs face the narrowest menu under FATCA, and a pooled AIF is likely a PFIC for a US person; a PMS or a GIFT City vehicle sidesteps that.

This guide assumes you already know your residency status and how NRE versus NRO money works; if not, start with NRE, NRO and FCNR accounts. What follows is the part that costs real money: the SEBI floors and the new Rs 10 lakh option that sits below them, the structure decision that determines whether you can take your money back out in dollars, the category-by-category tax that is the single biggest variable, the US and Canada wall, and whether, after fees and tax, any of it beats the boring mutual fund. Where the answer depends on which country you live in, and it often does, I will say so.

You own the stocks in a PMS; you own units in an AIF, and that decides the tax

The marketing blurs the two on purpose, because the difference is the whole story.

A Portfolio Management Service is discretionary management of your own securities. You open a dedicated demat and bank account, transfer in cash or stock, and a SEBI-registered portfolio manager trades in that account on your behalf. The structural fact that drives everything: you own the underlying securities directly. No pooling, no units. The shares sit in your name, and the manager merely holds the mandate to trade them. That is why a PMS is taxed exactly like trading yourself, and why it is the only one of these structures a US person can usually hold without a PFIC headache.

An Alternative Investment Fund is a pooled vehicle. Many investors commit capital, the fund is a single legal entity (usually a trust), and it invests to a defined strategy. You own units of the fund, not the underlying assets. AIFs are regulated under the SEBI (Alternative Investment Funds) Regulations, 2012, and the three categories matter enormously for tax and risk. Category I backs what the regulator considers economically desirable: venture capital, startups, SMEs, infrastructure. Category II is the broad middle, where most rupee AIF money sits: private equity, private credit, real estate funds. Category III runs complex or leveraged strategies: long-short equity, derivatives books, hedge-fund-style mandates. That third category carries a punitive fund-level tax, and it is where most expensive mistakes happen.

Hold onto the one-line distinction: a PMS means you own the stocks; an AIF means you own units in a fund that owns the assets. That ownership difference is not cosmetic. It decides who is taxed, when, at what rate, and whether the US PFIC regime bites.

The SEBI floors are statutory, and there is now a Rs 10 lakh option below them

The minimums are the first filter, and you cannot argue them down.

PMS is Rs 50 lakh per client, per strategy. SEBI raised this floor to Rs 50 lakh in January 2020, up from the Rs 25 lakh that had applied since 2012, which had itself replaced the original Rs 5 lakh from 1993. The number applies per investor and per strategy, and you must maintain it. Invest Rs 60 lakh, and a later partial withdrawal cannot take the account below Rs 50 lakh; the regulation requires the floor to hold throughout, not just at entry. The portfolio manager must also carry a net worth of at least Rs 5 crore to stay registered.

AIF is a Rs 1 crore minimum commitment. Each outside investor commits at least Rs 1 crore. (Employees and directors of the manager get a Rs 25 lakh threshold, irrelevant to you.) The operative word is commitment: in many Category I and II funds you commit a crore but the money is drawn down in tranches over the investment period through capital calls, not paid on day one. An uncalled commitment is still a binding obligation, so plan your liquidity around the call schedule, not the cheque date.

Here is the development most guides written before 2025 miss. Since April 1, 2025, SEBI runs a third structure that sits squarely between a mutual fund and a PMS: the Specialised Investment Fund (SIF), at a Rs 10 lakh minimum per investor across all SIF strategies in one AMC. The SIF was created precisely for the investor who wanted hedge-fund-style flexibility, long-short positions, sector rotation, unhedged short exposure up to 25% of the portfolio via derivatives, but balked at the Rs 50 lakh PMS or Rs 1 crore AIF ticket. For an NRI weighing a Category III AIF purely to access a long-short strategy, a SIF can deliver a similar exposure at a fifth of the entry and, being a mutual-fund-structure product, with cleaner pass-through tax than a Category III trust. It is new and the menu is still thin, but it changes the "is it PMS, AIF, or nothing" question into a four-way choice.

Why do the higher floors exist? SEBI's logic is investor protection through self-selection: PMS and AIFs carry lighter disclosure than mutual funds, can run concentrated and illiquid books, and in Category III can use leverage, so the regulator restricts them to investors able to write, and tie up, a Rs 50 lakh or Rs 1 crore cheque. Whether that holds for every HNI is debatable; that the floor is real is not. The practical effect for an NRI: these are products for someone who already has a large rupee corpus and wants to deploy a slice differently, not for someone remitting USD 2,000 a month to build a base. If you are still in the building phase, read building an India corpus as an NRI first.

Who they actually suit, and the four tests you must clear

Strip away the velvet rope and a PMS or AIF earns its place for a narrow profile. Four conditions, and you need all four.

You are a genuine HNI, with enough that Rs 50 lakh to Rs 1 crore in a single concentrated or illiquid strategy is a sensible slice, not your whole India book. As a rough discipline, advisers commonly cap PMS at 10% to 20% of an equity portfolio, which implies you want Rs 2.5 crore to Rs 5 crore of investable India equity before a Rs 50 lakh PMS makes allocation sense. If the ticket is more than a fifth of your investable India assets, the concentration risk alone should give you pause.

You want something a mutual fund cannot give you. This is the real test. A high-conviction 20-stock PMS book, a Category II private-credit or pre-IPO fund, a Category I venture fund, a Category III long-short strategy: these are exposures you cannot replicate by buying a regular fund. If what you actually want is diversified equity, a mutual fund does that more cheaply and cleanly, and the PMS is just a costlier route to a similar place. See direct equity vs mutual funds for NRIs.

You can tolerate the illiquidity and the reporting load. AIFs lock capital for years; a PMS is more liquid but throws off a long trail of individual transactions, one capital-gains computation per security at tax time. And the part nobody raises in the sales meeting: you live somewhere the manager will actually accept you. For US and Canada NRIs, that alone disqualifies most of the market. If you do not clear all four, the honest answer is usually a low-cost mutual fund portfolio, with a SIF as the middle option if you genuinely want the sophisticated strategy. Where these fit in an overall allocation is covered in NRI portfolio and asset allocation.

Repatriable or non-repatriable: settle this before you sign

This is the first thing to fix, because it governs whether you can take the money back out in foreign currency later, and retrofitting it is painful.

A repatriable investment means proceeds, capital and gains, can be sent abroad freely. You fund it from your NRE account or fresh foreign currency remitted for the purpose. For a PMS, this runs through a demat and bank account on a repatriable basis, and for listed-equity strategies the manager typically routes purchases through the Portfolio Investment Scheme (PIS), the RBI mechanism for NRI secondary-market equity, opened with a designated bank branch that monitors your trades. The mechanics are in buying Indian stocks on the PIS route. For an AIF, you commit from NRE funds and the fund is structured to allow repatriation of distributions.

A non-repatriable investment keeps the money inside the Indian system. You fund it from your NRO account, which holds India-sourced income (rent, dividends, earlier sale proceeds). You can invest, earn and redeem, but to send proceeds abroad afterwards you use the ordinary NRO route: up to USD 1 million per financial year, after taxes, with Form 15CA and 15CB. That route is covered in the NRO repatriation process.

Which to choose? If the money came from abroad and you may want it abroad again, use the repatriable (NRE) route so you are not later squeezed against the USD 1 million ceiling. If you are deploying India-sourced money you are content to keep in India, the non-repatriable (NRO) route is simpler to fund and skips the PIS overhead. Many NRIs hold both kinds of money and match the source to the structure. One hard rule: you cannot shuffle NRO money into NRE to dodge the cap, because the NRO-to-NRE transfer is itself bound by the USD 1 million limit, as set out in NRO to NRE transfer. And confirm at the outset that your chosen manager actually supports the route your money needs, because not every PMS or AIF offers both.

Taxation: the part that swings the outcome by lakhs

Here is where PMS and AIFs diverge hardest, and where most of the confusion, and most of the lost money, lives. Take them in turn.

A PMS has no special tax regime. Because the shares sit in your own demat, every sale the manager makes is your capital gain or loss, computed security by security, exactly as if you traded yourself. For listed equity, for transfers on or after July 23, 2024, long-term gains (held over 12 months) are taxed at 12.5% above the Rs 1.25 lakh annual exemption, and short-term gains at 20%, both before surcharge and cess. These are the same rates an NRI pays on directly held shares, set out in full, including the 15% surcharge cap and the basic-exemption trap that hits NRIs but not residents, in capital gains tax on NRI shares and mutual funds. The PMS, acting for a non-resident, deducts TDS on the gains before crediting your account, which you reconcile when you file; reclaiming any excess is covered in TDS for NRIs and refunds.

Two consequences flow from direct ownership, and both cost money. First, an actively traded PMS generates a great deal of STCG taxed at 20%, a real drag against buy-and-hold. A high-churn manager can quietly cost you several percentage points a year in tax alone, even if the portfolio's value barely moves through reshuffling, so ask for the portfolio turnover ratio before you sign. Second, the PMS management and performance fees are generally not deductible against capital gains. If you report PMS income as capital gains, which most investors do, the fee is a cost you bear with no tax shield. Only if you classify the activity as business income, which is unusual and carries its own consequences, do the fees become deductible. That non-deductibility is central to the fee drag shown below.

AIF tax, by contrast, depends entirely on the category, and the spread is enormous. Category I and Category II AIFs have pass-through status under Section 115UB. The fund is generally not taxed on its investment income (other than business income); the income retains its character and is taxed in your hands as if you earned it directly, with the fund deducting TDS on distributions to non-residents. Budget 2025 sharpened this in your favour: it expressly defined securities held by Category I and II AIFs as capital assets, confirming that gains are capital gains rather than business income in the investor's hands, and rationalised the listed-equity LTCG rate to 12.5% from AY 2026-27. The net effect is that a Category I or II AIF is taxed broadly like the underlying assets, in your hands, which is efficient.

Category III AIFs get no pass-through, and this is the trap. In the common trust structure, the fund itself is taxed, typically at the maximum marginal rate (MMR), which for FY 2025-26 works out to about 42.7% (a 30% base rate, a 37% surcharge on that, and roughly 4% health and education cess on the total). The fund pays this before distributing, and you then receive the distribution with no further Indian tax. The "no tax in your hands" line is technically true, but only because the fund already paid at the highest possible rate, including a top surcharge that you, with modest other Indian income, might never have triggered on your own return. For a long-only equity strategy, paying 42.7% inside a Category III AIF is dramatically worse than the 12.5% LTCG you would pay holding the same equities through a PMS or directly. Category III makes sense only where the strategy genuinely cannot be run another way and the manager's edge is large enough to clear that tax wall. The category comparison in one line: Category I and II are taxed like you own the assets, which is good; Category III is taxed at the fund at the top rate, which is heavy. The industry has been lobbying in the Budget 2026 wishlist for a level field on Category III and private credit, so this may move, but plan on 42.7% until it does.

If you live in the US or Canada, read this before anything else

This section may end the discussion, so it comes before the fees.

FATCA (the US Foreign Account Tax Compliance Act) and CRS reporting impose ongoing burdens on any Indian institution that takes US and Canada NRIs as clients. Many PMS providers and AIFs simply decline these investors rather than carry it, exactly as a slice of Indian mutual fund houses do, a pattern covered in NRI mutual fund eligibility. A minority accept US and Canada residents and complete the extra FATCA self-certification and reporting, but the list is short, it changes, and you must confirm acceptance in writing up front rather than assume it.

Even where you can invest, two problems bite. First, your home country taxes the worldwide income. A US, Canadian or UK resident owes home-country tax on the gains earned in the Indian PMS or AIF, with a foreign tax credit for Indian tax paid under the treaty; the Indian rate is the floor, not the ceiling. Second, and decisively for US persons, a pooled AIF is very likely a PFIC. A Passive Foreign Investment Company carries annual Form 8621 filing and punitive US tax, including tax on notional unrealised gains under the default regime, which can erase any Indian advantage. The clean structural answer is a PMS, where you own individual securities rather than fund units, so the PFIC rules do not apply, the same logic that pushes US investors toward separately managed accounts everywhere.

For US and Canada NRIs determined to access pooled strategies, the GIFT City route is increasingly the sensible one, and it has moved fast. GIFT City is India's only operational International Financial Services Centre, treated as offshore, so funds there are fully repatriable in foreign currency without the usual FEMA and INR-conversion friction. In February 2025 the minimum for a GIFT City AIF was cut from USD 150,000 to USD 75,000, widening access, and in September 2025 Tata Asset Management launched India's first retail inbound fund at GIFT City with a minimum of just USD 500. Budget 2025 extended GIFT City's tax benefits to March 2030, giving five years of policy certainty. The important caveat: a pooled GIFT City fund is still a PFIC for a US person, so the same Form 8621 problem follows unless you use a separately-managed-account structure there. The GIFT City detail is in GIFT City investing for NRIs.

The honest summary for US and Canada NRIs: the domestic AIF market is mostly closed and tax-hostile even where open; a domestic PMS is occasionally available and PFIC-safe but still leaves you with home-country tax and a short list of willing managers; and GIFT City is the cleaner offshore road, though pooled funds there remain PFICs. Get a cross-border tax adviser involved before you commit a rupee.

The fees, and the high-water mark protection most investors do not invoke

PMS and AIF fees are materially higher than a mutual fund's, and they come in layers.

A PMS typically charges either a flat fixed fee of around 2% to 2.5% a year on assets, or a lower fixed fee (say 1% to 1.5%) plus a performance fee, commonly 10% to 20% of returns above a hurdle (often 8% to 10%), with brokerage, custody and audit costs on top. Here is the protection SEBI built in and that you should make the manager show you in writing: since the 2020 regulations, the performance fee must be computed on a high-water mark basis over the life of the investment. That means the manager earns a performance fee only on genuinely new gains above your portfolio's previous peak, not on merely recovering a prior loss; if the book falls and then climbs back, you owe nothing on the recovery until it clears the old high. The hurdle and the high-water mark work as a dual safeguard: even after crossing the previous peak, the performance fee applies only on returns above the hurdle from that new base, and interim contributions or withdrawals adjust the mark proportionately. Ask for the management fee, the performance fee, the hurdle and the high-water-mark arithmetic on your ticket size before you sign. And remember that for most investors reporting capital gains, none of these fees is tax-deductible, so the full fee is a drag on the after-tax return.

An AIF usually charges a management fee of around 1.5% to 2% plus a performance fee or carried interest, frequently 10% to 20% above a hurdle, plus a one-time setup or placement fee in some funds. In Category III you also bear the fund-level tax described above before you see a rupee. Contrast a regular-plan equity mutual fund at roughly 1.5% to 2.25% all-in with no performance fee, or a direct-plan fund at well under 1%, and the gap is stark. A 2% fixed fee plus 20% of the upside is a high bar for any manager to clear consistently after tax. The next two scenarios put numbers on exactly that.

Put real numbers on the fee drag first. Take Vikram, an NRI in the UAE, who invests Rs 1 crore in an equity PMS on a repatriable basis. The PMS charges a 2% fixed annual fee and a 15% performance fee on returns above a 10% hurdle, subject to the high-water mark. Suppose the portfolio earns a gross return of 16% in the year. Gross return is 16% of Rs 1,00,00,000, or Rs 16,00,000. The fixed fee is 2%, Rs 2,00,000. The return above the 10% hurdle is 6%, or Rs 6,00,000, and the performance fee is 15% of that, Rs 90,000. Total fees are Rs 2,90,000, leaving a net return of Rs 13,10,000, a 13.1% net.

Now run the same Rs 1 crore through a regular-plan equity mutual fund charging 1.75% all-in, earning the same 16% gross. The fee is Rs 1,75,000, and the net return is Rs 14,25,000, a 14.25% net. The mutual fund kept Rs 1,15,000 more in Vikram's pocket this year, on identical gross performance, purely on fees. For the PMS to win, the manager must out-perform the fund's gross by more than that gap, every year, after tax, and a recurring 1% to 1.5% gap compounds into a very large number over a decade. The PMS can justify itself, but only on a real and persistent edge, not one good year. The honest caveat: this ignores income tax, which for Vikram in the zero-tax UAE is only the Indian capital gains tax, identical in structure for both products. For a UK, US or Canadian resident, home-country tax sits on top of both, and a high-churn PMS spinning off 20% STCG would lose more to tax than a low-turnover fund, widening the gap further.

The starker number is the Category III tax wall. Take Priya, an NRI in the UK, who commits Rs 1 crore to a Category III AIF running a long-short strategy, and compare it against holding Rs 1 crore of similar long equity through a PMS. Assume both generate a gross gain of Rs 20,00,000 over the year, that the gains are long-term in nature, and ignore manager fees to isolate the tax. Through the PMS, the gain is in Priya's hands: from the Rs 20,00,000 gross LTCG, subtract the Rs 1,25,000 annual exemption to get a taxable Rs 18,75,000, taxed at 12.5% (before surcharge and cess) for an Indian tax of Rs 2,34,375, leaving about Rs 17,65,625 after Indian tax. Through the Category III AIF, the fund is taxed first at the MMR of about 42.7%: Rs 20,00,000 x 42.7% is Rs 8,54,000, and Priya receives the rest, Rs 11,46,000, with no further Indian tax.

The gap is Rs 17,65,625 versus Rs 11,46,000, roughly Rs 6,19,625 on the same gross gain, driven entirely by the structure's tax treatment. The Category III fund handed about 42.7% to the exchequer where the PMS handed about 12.5% on the same long-equity gain. The honest framing: this comparison is deliberately unfair to Category III, because a genuine long-short or derivatives strategy cannot be run inside a PMS or as a simple direct holding, which is the whole reason Category III exists. If the long-short manager's edge is large enough that, even after the 42.7% fund-level tax, Priya nets more than a long-only PMS would after its lower tax, the structure earns its keep. But a Category III fund used for what is effectively long-only equity is close to indefensible on tax alone. Priya, as a UK resident, then layers UK tax on the Indian outcome with a treaty credit for Indian tax paid, which makes the heavy Indian tax inside Category III at least partly creditable, though rarely fully neutral.

A side-by-side on PMS, AIF and a mutual fund

Dimension	Mutual fund (regular)	PMS	AIF
Minimum	None meaningful	Rs 50 lakh per strategy	Rs 1 crore commitment
You own	Fund units	The securities directly	Fund units
Typical fee	1.5% to 2.25% all-in	2% to 2.5%, or 1% to 1.5% plus 10-20% performance	1.5% to 2% plus 10-20% carry
Tax (listed equity LTCG)	12.5% in your hands	12.5% in your hands	Cat I/II: 12.5% pass-through; Cat III: ~42.7% at fund
Fees deductible vs gains	No	Generally no	Embedded in fund (Cat III)
US PFIC risk	High (pooled)	None (you own securities)	High (pooled)
Liquidity	Daily NAV	Liquid, transaction-heavy	Locked for years; capital calls
US/Canada access	Limited (FATCA)	Occasional, PFIC-safe	Mostly closed, PFIC-hostile

For an NRI who wants a sophisticated strategy below the Rs 50 lakh line, the SIF (Rs 10 lakh, mutual-fund structure, long-short capable) now slots between the first and second columns, with cleaner tax than a Category III AIF.

Edge cases

The Rs 50 lakh PMS floor must be maintained, not just met at entry. A partial withdrawal cannot take the account below Rs 50 lakh, so size your entry with headroom if you may need to draw down.

AIF commitment is not cash paid on day one. Many Category I and II funds draw down your Rs 1 crore over the investment period through capital calls over several years. Plan liquidity around the call schedule, and treat an uncalled commitment as the binding obligation it is.

High PMS churn quietly taxes you. Because every sale is your capital gain, an active manager produces STCG at 20% year after year, even if the portfolio's value barely changes through reshuffling. Ask for the turnover ratio; a low-turnover strategy is far more tax-efficient for the same gross return.

Category III's "tax-free in your hands" is the most misunderstood line in the market. It is true only because the fund already paid about 42.7%, including a top surcharge a non-resident with modest other Indian income might never have triggered alone. Treat the headline as a warning, not a benefit.

US persons and the PFIC trap on pooled funds. A pooled AIF, domestic or GIFT City, is very likely a PFIC, with Form 8621 and punitive US tax on notional gains. A PMS or a GIFT City separately managed account, owning securities directly, avoids this. For a US filer this is the single most important structural distinction.

Acceptance is not guaranteed for US and Canada NRIs. Most managers decline them under FATCA. Confirm in writing that the specific PMS or AIF accepts your country of residence before you build any plan around it.

Your residency status must qualify under FEMA and the Income-tax Act. In a returning-NRI or RNOR window, both the repatriation route and the tax position shift. See NRI residency and RNOR rules and, if you are filing in India, ITR filing for NRIs, AY 2026-27.

The closing read

The honest read is this. PMS and AIFs are not better than mutual funds; they are different, and that difference is worth paying for only in a narrow set of cases. The Rs 50 lakh and Rs 1 crore minimums are real statutory floors, the fees are materially higher and usually not tax-deductible, and the tax treatment swings from 12.5% to almost 43% depending on which structure you sign. A PMS is taxed cleanly, like the direct holding it is, which is its quiet advantage and the reason it is the only one of these a US person can usually hold without a PFIC fight. A Category I or II AIF passes income through to you efficiently, now confirmed at 12.5% LTCG from AY 2026-27. A Category III AIF carries a fund-level tax of about 42.7% that must be earned back before you are even level with a simpler structure, so judge any Category III pitch net of that wall.

So here is the recommendation, not a menu. For the great majority of NRIs, including many who could write the cheque, the right answer is a low-cost, well-diversified mutual fund portfolio: cheaper, cleaner to tax, accessible from most countries, and over a long horizon it beats most expensive active mandates after fees. If you genuinely want a sophisticated strategy but balk at the big ticket, look at a SIF at Rs 10 lakh before a Category III AIF, because the tax is cleaner. Step up to a PMS or AIF only when you clear all four tests: a true HNI for whom the ticket is a sensible slice, a strategy a fund cannot deliver (private credit, pre-IPO, venture, a genuine long-short book, a high-conviction concentrated mandate), the ability to sit out the illiquidity, and a manager who will accept your country of residence. For an NRI in the UAE or UK that last condition is usually met; for an NRI in the US or Canada, lean toward a PMS or a GIFT City separately managed account and bring in a cross-border tax adviser, because the domestic AIF market is largely closed and PFIC-hostile to you. Used for the job they are built for, these products are excellent. Used as a status upgrade on what a mutual fund already does, they are an expensive detour.

Related guides

• Building an India corpus as an NRI
• NRI mutual fund eligibility
• GIFT City investing for NRIs
• NRIs investing in unlisted startups
• Direct equity vs mutual funds for NRIs
• NRI portfolio and asset allocation
• Buying Indian stocks on the PIS route
• Capital gains tax on NRI shares and mutual funds
• TDS for NRIs and refunds
• ITR filing for NRIs, AY 2026-27
• NRI residency and RNOR rules
• NRE, NRO and FCNR accounts
• The NRO repatriation process
• NRO to NRE transfer

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Disclaimer: This guide is for general information only and is not financial, tax or legal advice. PMS, AIFs and SIFs are regulated by SEBI, and minimums, fee structures and tax rates can change; the Rs 50 lakh PMS minimum (raised January 2020), the Rs 1 crore AIF minimum, the Rs 10 lakh SIF minimum (effective April 1, 2025), the 12.5% LTCG and 20% STCG rates (effective July 23, 2024), the Section 115UB pass-through and 12.5% LTCG rationalisation for Category I and II AIFs (from AY 2026-27), and the roughly 42.7% fund-level taxation of Category III AIFs (FY 2025-26) reflect the position as understood in mid-2026. AIF commitments are illiquid and may be drawn down over time. US and Canada NRIs face FATCA-driven acceptance restrictions, and pooled AIFs, domestic and GIFT City, may be PFICs for US persons, with significant US tax consequences. Indian tax does not remove liability in your country of residence. Verify current SEBI regulations, manager acceptance of your country of residence, and your own tax position with the manager and a qualified cross-border tax adviser before acting.