Monday, 7 March 2016

Know About NRI Bank Accounts

At present bank accounts for Non- Resident Indian (NRIs)  has three categories :

1. NRE- Non -resident (external) rupee account.
2. NRO- Non- resident (ordinary) rupee account.
3. FCNR(B) - Foreign currency non-resident (banks) accounts.
These accounts can be distinguished as follows:
  • While NRO and NRE  accounts can be kept in the from of current , saving or term deposit accounts, while FCNR(B) deposit  can be kept only in the form of term deposits, for period ranging from 6 months to 3 years.
  • Money from an NRO account is non-repatriable, but NRE and FCNR deposits are repatriable.
  • Remittances from abroad can be credited to any of these accounts . But earnings of NRIs on the property held by them in India, which are non-repatriable , can be credited only to NRO accounts.
  • Interest earned on NRO accounts is eligible for repatriation. 
  • An NRO  account may be jointly held  with residents while NRE and FCNR (B) accounts cannot be jointly held with residents . But Indian resident power of attorney is permitted for local payments and investments in India.
  • Balance held in NRE/FCNR accounts  are  exempted from wealth  tax and interest earned is exempted  from income tax. There are no tax exemptions on interest earned on NRO accounts.
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