Non Resident Indians (NRI's), PIO (Persons of Indian Origin), Overseas Citizens of India (OCI) continuously require specific legal and financial information and guidance in regards to doing business in India i.e. StartUp, Government Documentation, Company Registration, Tax Liabilities, Remittances and Forex etc in India. Based on our vast amount of interactions with NRI's from across the world, we are of the opinion that NRI's are very keen to have good working relationships with friends, family and business associates in India, however the gap exists in proper and authentic guidance in financial matters, laws and procedures. At Klarti TaxCorp LLP, our experienced and technically expert NRI Customer Care Team welcomes questions from NRI at firstname.lastname@example.org. We shall be delighted to optimally address your financial and legal queries and build long term trust based relationship.
Non Resident Indians (NRI) :As per Reserve Bank of India (RBI), NRI is an Indian Citizen, who's residence is outside India. NRI is legally defined under "Income Tax Act, 1961" and "Foreign Exchange Management Act, 1999 (FEMA)" for applicability of respective laws.
Person of Indian Origin (PIO) :As per Reserve Bank of India (RBI), PIO is a citizen of a Foreign Country (except Bangladesh, Pakistan or such other country as may be specified by the Central Government), and satisfying the following conditions :
- He/She had an Indian Passport in the past 'or'
- His/Her parents/grandparents were/are Citizens of India 'or'
- His/Her spouse is an Indian Citizen or spouse of person in above mentioned points
Overseas Citizen of India (OCI) :An Overseas Citizen of India is a scheme under which Lifetime Indian Visa is granted. It is the closest thing to Dual Citizenship, which Government of India provides.
The following requirements can qualify an individual for OCI :
- He/She had an Indian Passport in the past 'or'
- His/Her parents/grandparents were/are Citizens of India 'or'
- His/Her spouse is an Indian Citizen or OCI for at least two years.
The following conditions disqualify an individual from obtaining OCI :
- He/She has/had a Pakistani/Bangladeshi Passport in the past 'or'
- His/Her parents/grandparents were/are Citizens of India Afghanistan, Pakistan, Bangladesh, China, Sri Lanka 'or'
- He/She is/had served in any Foreign Military or worked in a Foreign Defence Department.
Returning Indians :Indians who are coming back to India permanently after working in Foreign Countries for a long period of time. On returning to India, a person from being a non resident Indian becomes either a resident or gets a special status for a short period of time.
Asset Management :
Real Estate and Property Management :Real Estate is one of the most popular asset for NRI's. Sale, Purchase, Rental of Property in India and related Technical, Financial and Tax issues.
Inheritance Issues :NRI's having Inherited Assets (movable and immovable) in India are facilitated with services which include Asset Value Maximisation, Clearance from Tax Authorities (Local, State and Central Government), Asset Liquidation and Repatriation of Sale Proceeds while taking care of complete banking and related regulatory formalities.
Banking, Forex and Remittances :
Banking Operations :
- NRE : Non-Resident External Bank Account
- NRO : Non-Resident Ordinary Bank Account
- FCNR : Foreign Currency Non-Resident Bank Account
Forex, Remittances :
- Foreign Currency Exchange
- Repatriation of Income/Funds/Investments, RBI Procedures, FEMA Compliances etc
Tax Planning and Compliance :100% Tax Compliance
Income Tax Filing :NRI's having Bank Accounts, Investments, Property and other Financial Assets in India, we provide Comprehensive, In-Depth and Integrated Income Tax Filing Services for NRI. Our Experience and Industry Knowledge results in Zero Error Services for NRI's thereby resulting in 100% Tax Compliance and above all, Peace of Mind.
Property Tax Filing :We manage the Entire Financial and Legal Matters for NRI Clients having Residential and Commercial Property Assets in India. Our range of Services also include "timely" filing of Property Tax Returns, Facilitation of repatriation of Sale Proceeds from Sale of Commercial/Residential Property, while taking care of complete banking and related regulatory formalities.
GST Compliance :Tax Compliance for GST Tax. GST Tax Returns.
Investment Advisory :Investment Advisory, Govt Regulations etc
- NRI's interested in exploring various Investment Options in India are provided with Optimum Investment Options i.e. Safety of Investment & Best Possible Return on Investment (RoI). We can provide Debt & Equity Investment opportunities for NRI's. Wide Range of "Good " Investment Opportunities are available in Greenfield and Brownfield Projects for NRI's
StartUp New Business :Integrated Solutions for StartUp
- Our team of Experts willingly provide all Company Secretarial Services which include Setting-Up of New Business Enterprise (Pvt Ltd, LLP, Public Ltd, Partnership Firm, Trust, NGO etc), Tax Documentation, Trademark and Copyright Approvals, Import-Export Code, State and Central Government Approvals, all under One Window and in a specified time frame.
As a NRI, why should I invest in India ?
- India enjoys Social, Economic and Political Stability.
- Indian "Consumption Market" is amongst the biggest in the world. Majority of consumers are young, educated individuals.
- India now has one of the largest and leading StartUp and Entrepreneurial Ecosystem in the World.
- India's Economy is inherently resilient and amongst the fastest growing economies (GDP growing at 7%+ Year on Year) in the world.
- Government Policies are pro investment and Policy is being further enhanced for investor benefits.
- India has a well developed, mature and robust Banking System which has sufficient checks and balances and is highly interconnected with the Global Banking System.
- India has a Vibrant, Well Regulated (via Securities and Exchange Board of India SEBI & Reserve Bank of India RBI) and Deep Capital Market. (National Stock Exchange, Bombay Stock Exchange etc)
- Returns from Equity Market in India are High and Consistent.
- Goods and Service Tax (GST) introduction from 1st July, 2017 is bound to create a Transparent Tax Regime system across the country, which is believed to significantly enhance the scale and growth rate of Indian GDP.
As a NRI, can I purchase (buy) or sell property in India ?Yes. Absolutely. As a NRI, you can purchase and sell property (residential and commercial) in India. There is no special (extra) permission) required from the Government. The laws applicable for a resident Indian are the laws applicable on you, as a NRI. However, a NRI can sell Farm Land, Plantation Land Agricultural Land only to a Citizen or Resident of India. Purchase of property in India cannot be done via Foreign Currency. Property purchase in India for everybody can only be done via Indian Rupees (INR). Further there is no restriction on the number of properties which an NRI can obtain. As a NRI, one can also give Power of Attorney (PoA) to a resident Indian, to complete the purchase process on behalf of the NRI. The sale proceeds have to be deposited in a NRO Bank Account. If you are Peron of Indian Origin (PIO) but are currently citizen of Afghanistan, Bangladesh, Pakistan, Sri Lanka, Bhutan, Nepal, Iran you shall required prior approval from Reserve Bank of India for initiating any property related transaction in India.
What is the difference between NRE and NRO Bank Accounts ?
- NRE (Non Resident Rupee Bank Account) : NRE Bank Account is opened by an individual who resides outside India. NRE Bank account can be opened as a savings or current bank account. NRI's can maintain foreign currency earnings in Indian Rupees in a NRE Bank Account. All funds available in the NRE Bank Account (including interest) can be freely repatriated from India. The Interest earned on NRE Bank deposits is non-taxable in India.
- NRO (Non Resident Ordinary Rupee Account) : NRO Bank Account is opened by an Individual who resides outside India but has earnings from various sources (like pension, rent, business in India etc) and wants to keep income generated from India in a Bank Account in India. These funds i.e. Funds in NRO Bank Account do not qualify for remittance outside India, as is the case in NRE Bank Account. NRO Bank account can be opened as a savings or current bank account. Interest earned on NRO Bank Deposits as well as Credit Balances in NRO Bank Accounts are taxable.
As a NRI, can I remit money outside India (Outward Remittance) ?Yes. Non Resident Indians (NRI's), can remit money outside India (Outward Remittance) under guidelines of Foreign Exchange Management Act (FEMA). Some important points to remember :
- NRE Bank Account balances are freely repatriable. There is no upper limit for Outward Remittances from NRE Bank Accounts.
- NRI's can also make Outward Remittances via online mode from NRE and FCNR Accounts. Online remittance facility is not available for NRO accounts.
- NRI's can also conduct Outward Remittance by obtaining Certificate from Charter Accountant. This certificate has to be submitted to Reserve Bank of India (RBI) for approval, alongwith an undertaking by the NRI.
What will happen to the NRE/FCNR status of Bank Accounts of a NRI who is returning back to India ?A NRI who is returning back to India for life stay in India, is known as Returning Indian. The NRE and FCNR Bank Accounts of such an individual shall be re-designated as Resident Bank Account. On returning to India, the NRI can continue to hold any assets in Foreign Currency, if the same were acquired while being an NRI or a PIO.
I am a NRI, but I am now returning to India. Can I still hold assets abroad (outside India) ?Yes. You can hold assets outside India. As per section 6(4) of FEMA Act, any individual who is a resident in India can hold or transact any asset/immovable property situated outside India; if such asset/property was acquired/owned by the same individual, when he was resident outside India or inherited from a person who was resident outside India. In such cases, there is no approval required from Reserve Bank of India (RBI).
|Residential Status||Indian Income||Foreign Income|
|Resident and Ordinarily Resident (ROR)||Taxable||Taxable|
|Non-Resident Indian (NRI)||Taxable||Not Taxable|
What are the routes for a NRI to officially investment in Indian Companies ?Non Resident Indians (NRI's) are permitted to invest in Indian Companies under the following routes/schemes :
- Portfolio Investment Scheme (PINS) : Portfolio Investment Scheme is a scheme of Reserve Bank of India (RBI). Under this scheme, NRI's can Purchase (Buy) and/or Sell Shares and Debentures of Indian Companies via recognised Stock Exchange. It can also be termed as buying equity via Secondary Market. PIS scheme of Reserve Bank of India is defined in Schedule 3 of Foreign Exchange Management Act (FEMA) 2000. In this scheme, NRI's can choose to invest under repatriation or non-repatriation schemes. For investment under repatriation scheme, NRE Bank Account is necessary. For investment under non-repatriation scheme, a NRO Bank Account is sufficient. It is important to note that a NRI can appoint only one Designated Bank for the purpose of routing of all transactions under the Portfolio Investment Scheme (PINS). A NRI can have multiple NRO and NRE Bank Accounts in India and with multiple banks and branches; however any investment which the NRI has to make under Portfolio Investment Scheme (PINS) can only be done via only one NRE or NRO Bank Account which is maintained in a designated Bank Branch.
- Direct Subscription Route (DSR) : Accordingly to Reserve Bank of India (RBI) guidelines, NRI's can also invest partly in Indian Companies by directly subscribing to the Equity/Convertible Debentures of Indian Company via Company's Public offerings or via Private Placements on One-to-One basis.
Can I transfer money from NRO Bank Account to NRE Bank Account ?No. It is not permitted. Money cannot be transferred from a NRO Bank Account to a NRE Bank Account
As a NRI, can I invest in Government Securities on "repatriation basis" ?Yes. As a NRI, you can invest in Government Securities on repatriation basis in :
- Bonds : Bonds issued by Public Sector Undertakings.
- Securities : You can invest in Treasury Bills, Domestic Mutual Funds etc.
- Disinvestment PSE : You can invest in Shares in Public Sector Enterprise under disinvestment by Government of India.
As a NRI, what are the various "FDI Investment Routes" available to me in India ?The following Foreign Direct Investment (FDI) routes are available for Non Resident Indians (NRI's) :
- Automatic Approval - Route.
- Prior Approval from Central Government - Route.
What is the Portfolio Investment Scheme (PINS) ?Portfolio Investment Scheme (PINS) has been launched by Reserve Bank of India (RBI). It is well defined in Schedule 3 of Foreign Exchange Management Act (FEMA) 2000.
Under the PINS Scheme, Non Resident Indians (NRI's) are permitted to invest in Equity Markets in India. Non Resident Indians (NRI's) and Person of Indian Origin (PIO) can legally transact i.e. purchase and sell share and convertible debentures in any recognized stock market of India. Under this scheme, all capital necessary for the transaction should be routed via NRI Bank Accounts (i.e. NRE Bank Account and NRO Bank Account) in a Designated Bank Branch. The investments which the NRI's intend to make require prior approval of RBI Designated Bank Branch, before any transaction can be initiated. The RBI Designated Bank Branches are empowered by RBI to issue necessary permissions to Non Resident Indian's (NRI's). Investments made by NRI's under the PINS Scheme can be on repatriation basis (via NRE Bank Account) as well as non-repatriation basis (via NRO Bank Account). A Non Resident Indian (NRI) can purchase maximum upto 5% of the Aggregate Paid-up Capital of the company (Equity + Preference Capital) or Aggregate Paid-up Value of each series of Convertible Debentures.