PPFAS GIFT City funds: IFSC S&P 500 and Nasdaq 100 FoFs
PPFAS Alternate Asset Managers IFSC Private Limited is the GIFT City fund management company of the PPFAS group, registered with the International Financial Services Centres Authority as a retail fund management entity (FDM2025FMR0814) and wholly owned by Parag Parikh Financial Advisory Services Limited, the sponsor of PPFAS Mutual Fund . It runs two US index funds for Indian residents, the Parag Parikh IFSC S&P 500 FoF and the Parag Parikh IFSC Nasdaq 100 FoF, both allotted on 20 March 2026.
The company was incorporated on 18 November 2024 under the Companies Act 2013 and operates from GIFT City , Gandhinagar. Besides the two index funds, it offers a portfolio management service with a global equity strategy, and has filed a draft offer document for the Parag Parikh India Flexi Cap Fund, a dollar-denominated feeder into the Parag Parikh Flexi Cap Fund for non-resident investors. A Parag Parikh India Large Cap Fund was listed on gift.ppfas.com as “Coming Soon” on 23 October 2026.
The GIFT City business matters to Indian investors because it is a second route into US equities from the same fund house, outside the SEBI-regulated mutual fund. The flagship Parag Parikh Flexi Cap Fund held 11.90 per cent abroad in September 2026, its fresh overseas buying limited by SEBI since 2022. The GIFT City funds are bought in US dollars with the investor’s own remittance under the RBI’s Liberalised Remittance Scheme , and pay tax at the scheme level under rules different from those for Indian mutual funds.
Earlier versions of this page described these products as partner-level arrangements, notably with Vested Finance. The PPFAS offer documents describe no such partnership: the funds are run by PPFAS’s own subsidiary.
The fund management entity
PPFAS Alternate Asset Managers IFSC Private Limited (CIN U66309GJ2024PTC156345) is a Registered FME (Retail) under the IFSCA (Fund Management) Regulations 2025, the category that may offer schemes to retail investors in an IFSC. The August 2026 offer document for the S&P 500 FoF gives its structure:
| Item | Detail |
|---|---|
| Incorporated | 18 November 2024, Companies Act 2013 |
| Parent | Parag Parikh Financial Advisory Services Limited, which holds 1,39,99,994 of 1,40,00,000 shares; six nominees, including Neil Parikh and Rajeev Thakkar, hold one share each |
| Directors | Rajeev Thakkar (non-executive), Nirmal Bari (executive), Dhinal Shah and Viral Jhaveri (independent) |
| Key personnel | Nirmal Bari, Principal Officer; Purvesh Pandit, Compliance Officer and Company Secretary; Akshay Falgunia, Fund Manager |
| Trustee | Axis Trustee Services Limited (GIFT City Branch) |
| Custodian | Kotak Mahindra Bank Limited, IFSC Banking Unit (IFSCA registration IFSC/CUS/2021-22/004) |
| Registrar | Computer Age Management Services |
| Auditor | SDKD & Associates LLP |
Table: PPFAS Alternate Asset Managers IFSC Private Limited, Offer Document of the Parag Parikh IFSC S&P 500 Fund of Fund, August 2026.
The offer document states that the company “is a first-time manager and does not have any experience in fund management activities”. Its unaudited accounts for the year to 31 March 2026 show management fees of USD 26,464.99, total income of USD 99,325.19, expenses of USD 3,16,808.91 and a loss of USD 2,17,483.72. The PMS Disclosure Document of July 2025 described Rajeev Thakkar as an executive director; the August 2026 offer document, the later of the two, lists him as non-executive.
The company is a sister of PPFAS Asset Management Private Limited , the SEBI-registered asset management company of PPFAS Mutual Fund (registration MF/069/12/01). The two share a parent, and Rajeev Thakkar, Chief Investment Officer of PPFAS Asset Management, is a non-executive director of the IFSC company, but they are regulated separately, SEBI for the mutual fund and IFSCA for the GIFT City company. The group’s other entities are in PPFAS group structure .
The Parag Parikh IFSC S&P 500 and Nasdaq 100 FoFs
The two outbound funds are open-ended retail schemes, constituted as trusts under the Indian Trusts Act 1882, that each put almost all their money into one Invesco UCITS ETF listed in Europe. Both were allotted on 20 March 2026 at a face value of USD 100.
| S&P 500 FoF | Nasdaq 100 FoF | |
|---|---|---|
| IFSCA acknowledgment | IFSC/Retail/2025-26/005 | IFSC/Retail/2025-26/006 |
| Underlying ETF (share of assets, March 2026) | Invesco S&P 500 UCITS ETF Acc (99.97 per cent) | Invesco NASDAQ-100 Swap UCITS ETF Acc (99.97 per cent) |
| Benchmark | S&P 500 Net Total Return Index | NASDAQ-100 Notional Net Total Return Index |
| Maximum expense ratio, Class A direct | 0.40 per cent | 0.55 per cent |
| Maximum expense ratio, Class B regular | 0.70 per cent | 0.85 per cent |
| Actual expense ratio, March 2026 | 0.35 per cent (scheme 0.30) | 0.50 per cent (scheme 0.30) |
| AUM, 30 March 2026 | USD 4.39 million | USD 4.82 million |
| NAV, 30 March 2026 | USD 98.3331 | USD 96.8465 |
| Minimum, initial and additional | USD 500 | USD 500 |
| Exit load | None | None |
| Fund manager | Akshay Falgunia | Akshay Falgunia |
Table: Offer Documents of the Parag Parikh IFSC S&P 500 and Nasdaq 100 Funds of Funds, August 2026, and PPFAS GIFT factsheets, March 2026. Expense ratios include the underlying ETF; the scheme’s own charge is capped at 0.30 per cent for Class A and 0.60 per cent for Class B.
The offer documents say the funds “will generally favour investment in accumulating share classes”, so ETF dividends are reinvested rather than paid out, and both funds offer a growth option only. The minimum fell from the USD 5,000 initial amount printed in the March 2026 factsheets to USD 500 in the August 2026 offer documents.
Two scheme-level rules come from the regulations. Under the FM Regulations 2025, as quoted in the offer document, a retail scheme must have at least 20 investors, none holding more than 25 per cent, within six months of the offer closing. The S&P 500 offer document adds that the scheme may start investing at USD 1 million of corpus and must reach USD 3 million within 12 months of IFSCA taking the document on record. The fund management company must invest at least 1 per cent of AUM or USD 2,00,000, whichever is lower, in the scheme.
Who can invest
The S&P 500 and Nasdaq 100 FoFs are built for Indian residents. The August 2026 offer document lists residents “including resident Indian individuals, minors, … corporates, limited liability partnership” among eligible investors, and its tax section states that “the Scheme will have only resident investors (including manager/ sponsor) at all the time”. The same document excludes United States persons, residents of Canada, residents of countries on the FATF non-compliant list, and residents of countries whose regulator has not signed Appendix A of the IOSCO multilateral memorandum of understanding.
Non-resident Indians are the target of a different product, the Parag Parikh India Flexi Cap Fund. Its product page states that “Resident Indians will not be allowed”, and its offer document describes it as suitable for non-resident Indians and other foreign investors. Whether an NRI may invest in the S&P 500 or Nasdaq 100 FoF is not stated in any PPFAS document reviewed; the tax section’s resident-only assumption suggests not.
The PMS is open to persons resident outside India, NRIs, resident non-individuals under FEMA, and resident individuals “to the extent allowed under the liberalized remittance scheme (LRS)”, according to the PMS Disclosure Document.
How resident Indians invest: LRS and OPI
A resident individual funds a PPFAS GIFT City investment by remitting US dollars under the Liberalised Remittance Scheme. RBI Master Direction on LRS (FED Master Direction No. 7/2015-16, updated 6 September 2024) allows resident individuals to remit up to USD 2,50,000 in each April to March financial year, and its para 11 lets banks “facilitate remittances to International Financial Services Centres (IFSCs) in India for all permissible purposes under LRS”, including financial products under the IFSCA Act 2019. That provision took its present form through A.P. (DIR Series) Circular No. 15 of 10 July 2024.
Para 11 also allows a resident individual to open a foreign currency account in an IFSC for these purposes, and bars using it to settle domestic transactions with other residents. Money invested in a GIFT City fund therefore counts against the same USD 2,50,000 yearly limit as a US brokerage account or an overseas fund.
The overseas portfolio investment route is the alternative, open to Indian entities and resident individuals alike. RBI circular RBI/2024-25/41, A.P. (DIR Series) Circular No. 09 of 7 June 2024, amended para 24(1) of the Foreign Exchange Management (Overseas Investment) Directions 2022 so that “a person resident in India, being an Indian entity or a resident individual, may make investment … in units or any other instrument … issued by an investment fund or vehicle set up in an IFSC, as OPI”. The S&P 500 offer document says residents invest “under the Liberalised Remittance Scheme (LRS) … or under the Overseas Portfolio Investment (OPI) route”, and that the fund management company is not responsible for the investor’s compliance.
The PPFAS product page says the OPI route “is only allowed through GIFT city based pooled vehicle”. That is the product-page wording; the RBI circular text quoted above does not use the word “only”.
Tax for a resident investor
For FY2025-26, according to PPFAS’s taxability note, the PPFAS GIFT City index funds pay Indian tax themselves and the investor does not pay tax again on redemption. The PPFAS taxability note for the outbound funds, published in July 2026 on the law for FY2025-26 under the Income-tax Act 1961, states that “the taxes will be paid at the Scheme level and the investors will not be taxable on any gains earned by the Scheme”, and that “Gains arising from sale of units of the Scheme shall not be taxable in the hands of investors.”
The scheme-level rates in the note are these:
| Income of the scheme | Rate | Highest rate with surcharge and cess |
|---|---|---|
| Long-term capital gains, assets held more than 24 months | 12.5 per cent | 14.95 per cent |
| Short-term capital gains, 24 months or less | 30 per cent | 42.744 per cent |
| Dividends | 30 per cent | 35.88 per cent |
| Interest | 30 per cent | 42.744 per cent |
Table: tax at scheme level, PPFAS taxability note for the GIFT City outbound funds, July 2026 (FY2025-26).
The August 2026 offer document applies the Income-tax Act 2025 , in force from 1 April 2026, and treats each scheme as an irrevocable determinate trust taxed under sections 304 to 307 of that Act. Because the investors are all residents, it states, the scheme is not a specified fund and cannot claim the exemption that funds with non-resident investors receive. The offer document gives the same 24-month long-term threshold and 12.5 per cent rate without indexation.
The investor’s tax falls on the price rather than on a return. Subscriptions after the offer period are made at the long-term post-tax NAV; a redemption within two years of subscription is paid at the short-term post-tax NAV and one after two years at the long-term post-tax NAV, according to the taxability note and the offer document. A redemption inside two years therefore bears the scheme’s higher short-term tax provision.
Four other points from the taxability note matter at filing time:
- The gain is reported under Schedule “Exempt Income” in the return, and a loss on units cannot be set off against other income.
- Tax paid by the scheme does not appear in the investor’s Form 26AS, and the scheme issues no tax certificate.
- On Schedule FA, the note contradicts itself: one answer says the holding must be disclosed, another that disclosure “may generally not be required”, with voluntary disclosure recommended.
- The note warns that if the scheme’s income were treated as business income, all of it would be taxed at 30 per cent, and says the scheme “intends to operate in a way that avoids this classification”.
The note also states that the funds are treated as passive foreign investment companies under US tax law, which matters to an investor with US tax obligations.
TCS on the remittance
A resident individual’s remittance into the GIFT City funds attracts tax collected at source under the Liberalised Remittance Scheme. The PPFAS note states that “TCS at applicable rates, currently, 20% will be collected by the remitting bank on investment amounts exceeding INR 10 lakh made by resident Indian individuals”, and that no TCS applies to investors other than resident individuals. From 1 April 2026, for FY2026-27, TCS is collected under section 394(1) of the Income-tax Act 2025, Table Sl. No. 7, as amended by section 85 of the Finance Act 2026, at 20 per cent above Rs 10 lakh for remittances other than education and medical treatment.
On the PPFAS note’s reading, which charges 20 per cent on the amount above Rs 10 lakh, a resident remitting Rs 12 lakh in a year bears TCS of Rs 40,000 on the Rs 2 lakh excess, a webnotes.in calculation. The section 394 table does not itself state whether the rate applies to the whole remittance or only the part above Rs 10 lakh, so the figure should be checked against the bank’s TCS certificate. TCS is not a final tax; it is credited against the year’s tax liability or refunded through the income-tax return.
The Parag Parikh India Flexi Cap Fund for non-residents
The Parag Parikh India Flexi Cap Fund is an inbound feeder: an IFSC retail scheme, constituted as an “open-ended, irrevocable, contributory determinate investment trust”, that invests 90 to 100 per cent of its assets in the Parag Parikh Flexi Cap Fund in India. Its offer document, marked as the IFSCA filing draft and read on gift.ppfas.com on 23 October 2026, sets these terms:
| Item | Detail |
|---|---|
| Eligible investors | Non-resident Indians and foreign investors; resident Indians excluded |
| Currency | US dollars in and out |
| Minimum | USD 10,000 initial, USD 1,000 additional, Class A direct and Class B regular |
| Maximum expense ratio | 0.93 per cent (Class A), 1.63 per cent (Class B), including the Indian fund |
| Deferred sales charge | 2 per cent within one year, 1 per cent in the second year, nil after two years |
| Status, 23 October 2026 | Marked “NFO” on gift.ppfas.com; no offer dates published |
Table: Offer Document of the Parag Parikh India Flexi Cap Fund (IFSCA filing draft) and gift.ppfas.com, read 23 October 2026.
For non-residents the draft states a tax route the outbound funds do not have. A scheme with non-resident investors is a specified fund, and under the 1961 Act provisions cited in the draft (sections 10(4D) and 10(23FBC), law as of 30 September 2025) the investor’s gain on units is exempt, and non-residents need not obtain a PAN under Rule 114AAB or file a return, subject to conditions. The draft does not give the corresponding sections of the 2025 Act. Indian residents who want the same portfolio can buy the Parag Parikh Flexi Cap Fund directly in rupees; the rupee route for NRIs is in NRI mutual fund investment .
The global PMS
PPFAS Alternate Asset Managers IFSC Private Limited also offers a portfolio management service under Regulation 74 of the FM Regulations 2025, in discretionary, non-discretionary and advisory forms. The PMS Disclosure Document of July 2025 describes the “Parag Parikh Global Investing Strategy”: at least 70 per cent in global equity and up to 30 per cent in money-market instruments, liquid funds or bank balances, benchmarked to the S&P 500 Net Total Return Index and managed by Akshay Falgunia. The minimum is USD 75,000, except for accredited investors. No fee schedule appears in the document, and no AUM figure was found in it or on gift.ppfas.com as of 23 October 2026.
Comparison with other routes to US equity
A resident Indian has four common routes to US shares, and the PPFAS group operates in two of them.
| Route | Regulator | Currency | Overseas limit | Tax on the investor’s gain |
|---|---|---|---|---|
| Parag Parikh Flexi Cap Fund (about 12 per cent abroad) | SEBI | Rupees | USD 1 billion per mutual fund within USD 7 billion | Equity rates under sections 196 and 198, Income-tax Act 2025, FY2026-27 |
| Indian international FoF or index fund | SEBI | Rupees | Same SEBI limits | Not equity oriented; see international fund tax |
| PPFAS IFSC S&P 500 or Nasdaq 100 FoF | IFSCA | US dollars | Investor’s LRS limit, USD 2,50,000 a year | Paid by the scheme; exempt for the investor (PPFAS note, FY2025-26) |
| Direct US shares through an overseas broker | Foreign regulator | US dollars | Investor’s LRS limit | Investor taxed on gains and dividends |
Table: routes to US equity for a resident Indian, from the Parag Parikh Flexi Cap Fund SID of 28 November 2025, SEBI Master Circular SEBI/HO/IMD/IMD-PoD-1/P/CIR/2024/90 of 27 June 2024, the PPFAS GIFT offer documents of August 2026, and the RBI LRS Master Direction.
The USD 7 billion industry limit in the SEBI Master Circular applies to SEBI-registered mutual funds. The PPFAS GIFT City funds are IFSCA-regulated schemes funded by each investor’s own LRS or OPI remittance. No PPFAS document reviewed addresses how the two limits interact. The SEBI-side alternatives are in international equity fund of funds , and the trade-offs against a foreign broker in FoF versus direct foreign brokerage . The stock-level foreign book of the flagship is in PPFAS foreign core rationale .
The IFSCA rules behind the funds
The funds operate under the IFSCA (Fund Management) Regulations 2025, notified in the Official Gazette on 19 February 2025 according to IFSCA’s press release, which replaced the 2022 regulations. IFSCA circular F. No. IFSCA-IF-10PR/1/2023-Capital Markets/7 of 8 April 2025 dealt with the transition. As quoted in the S&P 500 offer document, regulation 2(1)(ff) defines a retail scheme as one “offered to all investors or a section of the investors for subscription with no ceiling as to number of investors”.
The regulations create three fund management entity categories: Authorised FME, Registered FME (Non-Retail) and Registered FME (Retail). As quoted in the S&P 500 Offer Document, the retail category, which PPFAS holds, requires a net worth of USD 1 million and a track record of five years managing at least USD 200 million for more than 25,000 investors, or a 25 per cent shareholder with such a record. The 2025 regulations cut the minimum corpus of a retail scheme from USD 5 million to USD 3 million, and exempt a fund of funds from single-company and single-sector limits where the underlying funds comply, according to the IFSCA press release.
Risks and limits
Size. The two outbound funds held USD 9.21 million together at 30 March 2026, a webnotes.in sum of the factsheet figures, and the offer document requires each to reach USD 3 million within 12 months of IFSCA taking the document on record. The fund management company recorded a loss of USD 2,17,483.72 in FY2025-26 on its first, small year of fees.
Currency. The funds are denominated in US dollars, so the rupee value of a holding moves with the exchange rate, and the offer documents reviewed describe no currency hedge. The flagship Parag Parikh Flexi Cap Fund, by contrast, hedges about 80 per cent of its foreign exposure.
Tax uncertainty. The PPFAS taxability note rests on the 1961 Act and FY2025-26, while the offer document applies the 2025 Act. The note contradicts itself on Schedule FA and names business-income classification as a risk. Investors cannot see the scheme’s tax payments in Form 26AS.
Passive exposure only. The S&P 500 and Nasdaq 100 FoFs track indices through one ETF each. They do not apply the stock selection that PPFAS uses in the flagship’s foreign book, which held four US companies in September 2026.
Frequently asked questions
Does PPFAS have a GIFT City fund?
Can a resident Indian invest in the Parag Parikh IFSC S&P 500 FoF?
What is the minimum investment in the PPFAS GIFT City funds?
What do the PPFAS GIFT City index funds hold?
What is the expense ratio of the Parag Parikh IFSC S&P 500 FoF?
Is there an exit load on the PPFAS GIFT City S&P 500 and Nasdaq 100 funds?
Are gains on the PPFAS GIFT City funds taxable for a resident Indian?
Is TCS collected when investing in the PPFAS GIFT City funds?
Does investing in a GIFT City fund count towards the LRS limit?
Must PPFAS GIFT City fund units be reported in Schedule FA?
Can NRIs invest in the PPFAS GIFT City funds?
What is the Parag Parikh India Flexi Cap Fund in GIFT City?
Is the PPFAS GIFT City fund the same as PPFAS Mutual Fund?
Is PPFAS's GIFT City business linked to Vested Finance?
Who manages the PPFAS GIFT City funds?
See also
- PPFAS Mutual Fund
- Parag Parikh Financial Advisory Services Limited
- PPFAS Asset Management Private Limited
- PPFAS group structure
- Parag Parikh Flexi Cap Fund
- PPFAS foreign core rationale
- International diversification at PPFAS
- PPFAS SEBI overseas cap incident
- SEBI overseas investment cap for mutual funds
- PPFCF versus international FoFs
- International equity fund of funds
- Fund of funds in India
- FoF versus direct foreign brokerage
- International fund tax
- GIFT City
- International Financial Services Centres Authority
- Liberalised Remittance Scheme
- Overseas portfolio investment
- Tax collected at source
- FEMA
- Income-tax Act 2025
- Capital gains tax in India
- NRI mutual fund investment
- Portfolio management services
- CAMS
- Kotak Mahindra Bank
- Rajeev Thakkar
- Neil Parikh
- SEBI
External references
- PPFAS GIFT City funds
- PPFAS Mutual Fund
- International Financial Services Centres Authority
- RBI Master Direction, Liberalised Remittance Scheme
- RBI circular RBI/2024-25/41 on OPI in IFSC funds
References
- PPFAS Alternate Asset Managers IFSC Private Limited, Offer Document, Parag Parikh IFSC S&P 500 Fund of Fund, August 2026.
- PPFAS Alternate Asset Managers IFSC Private Limited, Offer Document, Parag Parikh IFSC Nasdaq 100 Fund of Fund, August 2026.
- PPFAS GIFT, factsheets of the Parag Parikh IFSC S&P 500 and Nasdaq 100 Funds of Funds, March 2026.
- PPFAS GIFT, “Taxability of PPFAS GIFT outbound funds”, July 2026 (FY2025-26).
- PPFAS Alternate Asset Managers IFSC Private Limited, Offer Document (IFSCA filing draft), Parag Parikh India Flexi Cap Fund, read 23 October 2026.
- PPFAS Alternate Asset Managers IFSC Private Limited, Disclosure Document for Portfolio Management Services, July 2025.
- IFSCA, press release on the notification of the IFSCA (Fund Management) Regulations 2025, 19 February 2025; circular F. No. IFSCA-IF-10PR/1/2023-Capital Markets/7, 8 April 2025.
- RBI, Master Direction on the Liberalised Remittance Scheme, FED Master Direction No. 7/2015-16, updated 6 September 2024, para 11; A.P. (DIR Series) Circular No. 15, 10 July 2024.
- RBI, A.P. (DIR Series) Circular No. 09, RBI/2024-25/41, 7 June 2024.
- Income-tax Act 2025 (Act 30 of 2025), sections 304 to 307 and 394.