| Who is NRI? |
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Indian citizens who stay abroad for employment or for carrying on any business or vocation or for any other purpose in circumstances indicating an indefinite period of stay outside India. Indian citizens working abroad on assignments with foreign Governments, Government agencies or international/multinational agencies like United Nations Organization (UNO), International Monetary Fund (IMF), World Bank etc. Officials of Central and State Governments and public sector undertaking deputed abroad on assignments with foreign Government/agencies/organizations or posted to their own offices (including Diplomatic Missions) abroad.
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| Can NRI open Bank account? |
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You can maintain an account with banks that are authorized dealers (i.e., those who can deal in foreign exchange) and those which have been authorized in this behalf by the Reserve Bank of India. You can maintain accounts in rupees as well as foreign currency. Foreign currency accounts can be maintained with authorized dealers only.
You want to return to India:
There are many facilities available to returning NRIs that will safeguard your investment interests. Returning Indians, who return to India after a continuous stay abroad of one year and above, can retain their foreign currency bank accounts abroad and hold, transfer or dispose of their other foreign currency assets. These funds/ assets should have been earned through employment, business or vocation outside India taken up or commenced while they were resident outside India. No permission is required from RBI as long as conditions of general exemption are satisfied. NRIs can enjoy complete freedom with utilization of these assets.
I am a foreign citizen:
A foreign citizen will be regarded as a Person of Indian Origin (PIO) if he at any time held an Indian passport or if his parents or grand parents are citizens of India, as defined in the Constitution of India.
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What is the Portfolio Investment Scheme?
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Under this scheme, NRIs/OCBs are permitted to invest in shares/debentures of Indian companies or units of domestic Mutual Funds through Stock Exchanges in India. These investments require prior approval of Reserve Bank of India
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What is the Portfolio Investment Scheme?
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Under this scheme, NRIs/OCBs are permitted to invest in shares/debentures of Indian companies or units of domestic Mutual Funds through Stock Exchanges in India. These investments require prior approval of Reserve Bank of India
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Can an NRI make investments through more than one designated branch?
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No. Each NRI/OCB has to select one branch for the purpose of investment on repatriation/non-repatriation basis. Although you can have multiple NRO and NRE account with different banks/branches but investments under Portfolio Investment Scheme cannot be made through more than one NRE or NRO account maintained with the designated bank branch.
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Being an NRI, what are the prerequisites to start investing in the Indian stock market?
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To trade on Indian Stock Exchanges in the capacity of an NRI, you would need to:
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- Open a bank account with a RBI (Reserve Bank of India) approved designated bank branch.
- Take RBI approval for investment in the Indian Stock Market.
- Open a Demat Account with a Depository Participant.
- Appoint a broker to execute trades on your behalf on the Exchange.
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Is it necessary for a resident Indian, holding securities in Indian companies, to secure any approval from the Reserve Bank of India on his becoming a non-resident for holding such securities?
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No. Reserve Bank of India has granted general permission to companies in India to enter the overseas addresses of the shareholders in their books in such cases, provided the companies obtain undertakings from the holders that they will not seek repatriation of any sale proceeds of the underlying securities.
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Are any tax concessions available to NRIs on balances/deposits held in NRE/FCNR accounts?
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Yes. Income from interest on moneys standing to the credit of NRE/FCNR accounts is exempt from income tax. Gifts from such accounts are also free of Gift-tax.
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Are similar concessions available in respect of balances held in NRO accounts?
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No.
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What are the tax benefits to the NRNR deposit account holders?
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They enjoy the following tax benefits:
Income from the deposits will be free from Indian Income-tax. The deposit will also be exempt from Gift tax for one-time gifting (in the case of NRIs only).
Exemption from Income-Tax will not be available to resident donee and those residents, who being joint holders, become owners of the deposit as survivor of the non-resident depositor.
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What about tax benefits on funds held in FCNR accounts?
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Tax Exemption on interest earned on deposits held in foreign currency is available to non-residents and persons who are not ordinarily resident in India as defined under Income-tax Act, 1961.
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What is the approved method of sending remittances into India?
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The approved method of sending remittances into India is through normal banking channels.
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At what rates are remittances in foreign currencies made by NRIs converted by banks into rupees?
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Such remittances will be converted by banks at the market rate of exchange.
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Can remittances be sent into India otherwise than through the medium of a bank in the country of residence of the remitter?
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Yes. Exchange Houses in Gulf countries have been permitted to send remittances into India by means of DDs, MTs and TTs drawn on banks in India.
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Can Exchange Houses draw drafts in foreign currencies?
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Yes. Exchange House can draw drafts in US dollars or Pound sterling on a limited number of branches of the drawee bank in India, if they have entered into such an arrangement with the drawee bank.
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Can NRIs remit funds through Exchange Houses for investment in Government securities, National Savings Certificates and Units of Unit Trust of India?
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Yes.
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Can NRIs remit funds through Exchange Houses for investment in shares/debentures of Indian companies?
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Yes, subject to general/specific permission of Reserve Bank for such investment.
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Can NRIs send drafts issued by Exchange Houses for acquisition of residential flats in India?
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Yes. NRIs can send drafts issued by Exchange Houses in favour of co-operative housing societies/estate develops for acquisition of residential flats in India in individual names
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Can NRIs remit premia on policies issued by the Life Insurance Corporation of India by means of drafts issued by Exchange Houses in favour of the Corporation?
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Yes.
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Can NRIs remit tuition/boarding/examination fees of their children studying in India by means of drafts issued by Exchange Houses in favour of schools, colleges, universities, technical and educational institutions in India?
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Yes.
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Can NRIs take out of India precious stones or jewellery purchased by them during their visit to India?
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Yes. NRIs can take out of India precious stones and jewellery (both gold and non-gold) purchased by them in India, without any limit, provided the purchase is made against payment in any convertible foreign currency.
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Can assets held in India by NRIs prior to their becoming non-resident be repatriated outside India?
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No.
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Can NRIs take out of India household articles such as carpets, curios, etc purchased out of funds in NRO accounts during their temporary visit to India?
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Yes. RBI permits on application such requests received from NRIs up to the value of Rs 20,000 for such articles other than those made of gold or silver or those banned for export.
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Can NRIs settle their hotel bills in India in Indian rupees?
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Yes.
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