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Month: August 2016

What NRIs Should Do to Bank A/c after Resettling in India?

What NRIs Should Do to Bank A/c after Resettling in India?

Are NRIs permitted to hold their assets abroad?

Many questions echo in the core of Non Residents of India (NRIs). Some of the questions are-“If I would be able to hold my foreign assets? ; What will happen to my foreign accounts? ; Should I close them all?” and many more….

Emergence of such questions is natural. But the best part is that they are allowed to keep hold of their foreign assets, like foreign currency in banks. However, they must convert their NRE, NRO and FCNR accounts into resident saving account. It is mandatory because their foreign accounts will be closed after shifting to India.

But it does not imply that they don’t have right to keep their foreign currency. Rather, they can keep it safe in the converted resident saving account. But they must inform the banks (in which their accounts are) about the resettlement to India.

What options NRIs have to change their bank account when resettling in India?

As said above, it is a must to convert foreign bank account into resident. Emigrants have three options for saving their hard earned money, i.e. NRE, NRO and FCNR account. These are the best services for NRIs. So, what’s the appropriate options for their conversion, have a look:

  • For NRO account holders, resident saving account is an appropriate option.
  • For NRE and FCNR account holders, Resident Foreign Currency (RFC) account is the best alternate.

What are the types of Resident Foreign Currency (RFC) account?

It is categorized in to two groups for:

  • Shifting NRIs
  • Resident Indians

What will happen to NRIs fixed deposit with the foreign account, if any?

Fixed deposits ensure long time investment at handsome rate of interest. Emigrants are no exception to it. So, what will happen to it if they have invested in foreign account after shifting in India?

  • NRIs need not dissolve their fixed deposits (FDs) since keeping it until maturity is permitted.
  • As FD matures, its holder must convert NRE/ FCNR account to RFC account.
  • After the account conversion, the account holder’s status is checked. If he is applicable for Resident (and Resident Not Ordinarily Resident or RNOR), then he can have an extra dose of benefits. He needs not pay tax for another 2 years.

(Those who have spent continuous 9 years are categorized under RNOR status.)

What’s the best option for keeping foreign currency in India?  

In India, Reserve Bank of India is the apex banking institution. According to its guidelines, the Indian residents can channelize their fund through foreign currency bank account. This account enables deposits in US dollars, EUR, GBP and Japanese Yen.

But an account holder is disallowed to deposit more than one currency in an account. If the need arises, the person can open another account. But he is unable to get any interest as it is not allowed.

Benefits of RFC account:

  • For transferring income earned from foreign sources
  • For depositing pension from foreign government/organization.
  • For transferring money from foreign country periodically.
  • No need to keep minimum balance
  • Fluctuating value of foreign currency does not cast any impact.

Steps to Convert PIO Card to OCI Card

Steps to Convert PIO Card to OCI Card

PIO cards no more exist as Indian government has ordered for the cancellation of this immigration service. But its conversion to OCI card has smoothened the way of PIOs to travel India. It’s a good alternative. This cancellation is not applicable for those who obtained it before January 9, 2015. They can extend its validity to lifetime by getting it stamped from the Indian consulate office. Individuals in foreign security and retired foreign policemen are not applicable for it.

To get it converted to OCI card, the applicant can go to They must through Part A and Part B of registration. In Part A, the applicant must provide details of self, passport and family. Afterwards, he/she can get a web file number. Then, part B will initiate. The registration form will appear. Provide all the requisite details. Submit it with the enclosed documents online. The government does not charge any money for this service. But if one hires any outsourcer, he/ she must pay certain amount as service charge.

Steps to Convert PIO Card to OCI Card

How NRIs Can Repatriate Pension to the US from India?

How NRIs Can Repatriate Pension to the US from India?

Repatriation of Pension in the US

Repatriation of pension amount stands for returning the annuity. The US is hugely populated with Indian diaspora. India terms them as NRIs. Many of these have spent their life in government jobs.  And later after retirement, they settled in the US with their children.

How easy is to repatriate it to the US?

In such cases, they are still eligible for withdrawing their pension amount. After all, it’s a part of their hard earned money that they receive at the time of retirement. So, how can they receive their pension in the US? Should they come down to India for carrying out formalities? Its answer is hidden in the below mentioned statement of RBI (The excerpt conveys the synonymous message of the RBI statement):

“RBI has declaimed that the NRIs/PIOs who don’t have their NRO account and non-taxable income in Indian need to pay no formality of submitting a Chartered Accountant’s certificate. This certificate is mandatory for remitting current income of those having taxable income in India. It includes dividend, rent, pension, interest and so on.”

Its statement has declared it as one of the most affordable NRI services. It further read an instruction for the authorized dealers that they can procure a simple declaration from the NRIs/PIOs. In it, they should declare that their income is grouped under non-taxable income. Hence, they are not the tax payer in India. The dealer can keep the declaration with them for the future reference from the Income Tax Authorities (if required).

How the present system of repatriation differs from the earlier one?

  • Earlier, RBI issued a notification to the bankers. The apex banking entity of India permitted repatriation of the current earnings in India. The current earning can be sourced through rent, dividend, pension, and interest. But now, it is not required.
  • The repatriate system also required a Chartered Accountant Certificate. It certified the exact source of the payee’s income. And also declared whether it was taxable or not. But now, it is also not mandatory. The migrants can present a declaration stating they belong to non-tax payer group.
  • Earlier, migrants necessarily required NRO account as a transferring channel. But now, it is not required.