NRI Banking


Provisions of the Income Tax Act with reference to NRIs
A person who is resident but not ordinarily resident is liable to tax the same way as that of resident, except that the income, which accrues or arises outside India, is not taxable in India unless it is derived from a business controlled in or a profession setup in India. In case of a non-resident the income received or deemed to be received in India or income accrues or arises or is deemed to accrue or arise in India only is taxable in India. Thus, the income accruing or arising outside India is not taxable in India. The following income, which might have been payable outside India are deemed to arise in India.
A person having been a non-resident for a continuous period of 2 years on his return will remain "not ordinary resident" for all least for 8 subsequent years. A not ordinary resident person will have the advantage of both (1) he will be liable to pay income tax on his Indian income only and (2) his foreign income will be free from Indian income tax.

Concessions Available to NRIs on their return to India
NRIs, who return to India after April 18, 1992 after having been "a person resident outside India" for a continuous period of at least one year have been granted the permissions on their return to India: To maintain and operate their foreign currency accounts with banks abroad. Resident account holders for making any payments to persons resident outside India can use funds held in these accounts. To hold transfer or dispose of their other foreign currency assets like shares, securities, life insurance policies, and immovable properties, business abroad NRI can continue as usual even after his return to India. Freedom to gift or settle their foreign currency assets to anybody, anywhere. To earn and retain abroad pension and retirement benefits, after return to India. To earn, hold or dispose off or invest, in any manner they deem fit, incomes on their foreign currency assets. To make any payments to or make any further investments abroad exclusively out of the foreign currency assets.

Non-resident Non-Repatriable Term Deposit Account
Accounts under the Non-resident (Non-Repatriable ) Rupee Deposit Scheme may be opened in Indian rupees by authorised dealers and opened by transfer of funds from the existing NRE/FCNR Accounts of the non-resident account holder. No penal interest is charged in case of premature withdrawal of existing NRE/FCNR deposits for the purpose of making investment under the scheme. The maturity period of such deposits is between six months and three years. They are also free to fix the rate of interest payable on such deposits. The maturity proceeds of the deposit will not quality for repatriation outside India at any time. The income form the deposits under the schemes will be free from Indian income-tax. Exemption from income-tax, however, is not available to resident donees and those resident who being joint holders, become owners of the deposits as survivors of the non-resident depositor.

NRO Rupee a/c
The accounts may be maintained in the form of savings or current or term deposit accounts. Non-residents can also open the accounts jointly with their close relatives resident in India and operations thereon by the resident account holders can be made freely. Get ATM card and can give a letter of mandate/POA to your local representative in India who can operate the account on your behalf, personalised chequebook, Net banking, bill pay. Banking at any of the profile branches in India.

Non-Resident (Sp) Rupee A/C
Non-Resident (Special) Rupee (NRSR) Account for such persons who would voluntarily undertake not to seek repatriation of funds held in these, with the exception that investment of funds held in these accounts in shares/securities and immovable property will be governed by the extant exchange control regulations and allow all financial transactions therein freely without going into the details of sources of credits and purposes of debits.