Many Indians might have left the country many years ago; still they don’t want to be aloof. They want to maintain monetary ties with their motherland and keep their financial obligations towards their loved ones intact. The Indian banks provide various types of NRI account which can be opened and operated from their place of work.
Types of NRI Bank Accounts
There are 3 types of NRI bank accounts that are obtainable in most of the foremost banks in India
NRE OR NON – RESIDENT EXTERNAL SAVING ACCOUNTS
This form of account helps the NRI’s to transfer the foreign currency for their loved ones with easiness in India.
Features
NRE Accounts are opened for keeping foreign currency. One cannot deposit any Indian currency into this account.
It can be opened as fixed and savings deposit accounts.
Any transfer of money in India becomes convenient and easy.
You can add nominee in the NRE Account.
Such accounts are not eligible for any type of wealth tax. The interest earned from such accounts is also exempted from taxes. Such exemptions are valid only to those who maintain these accounts in India plus are not related with Overseas Company Bodies.
Amount that is reserved in these accounts could further be effortlessly transferred to any further account.
It can be opened also in joint name with a NRI but opening it in joint name with an Indian Resident or Residents is prohibited.
All those who reside in Bangladesh or Pakistan cannot operate such accounts in India without seeking the consent of RBI.
If you decide to come back to India, the account gets transformed into Resident Account.
NRO OR NON-RESIDENT ORDINARY ACCOUNTS
NRO accounts do solve the purpose of NRIs having their property kept on rent and have a steady flow of earnings in rupees or dividends or pension rolling on regular basis whereas they reside in a foreign earth.
Features
The initial requirement of such account is – source of funds which are deposited in the account needs to be from inside the country and not from abroad.
These accounts involve Indian currency so this account is to be maintained in the Indian Currency.
But if you desire to send money to outside India it cannot be done without former adhering to the norm laid by RBI.
You can open such accounts as fixed deposit and savings accounts.
You can create these accounts in joint name with an NRI or a Resident.
Amount that is reserved in the account can further be effortlessly transferred into any other account.
Once you choose to return to India, account gets changed into a Resident Account.
Interest which is earned from NRO account falls beneath taxation slab. 30 % along with 3 % edification cess is to be deducted as TDS. The charge is valid to savings and fixed deposits accounts.
If the account owner signs the Letter of Authorization than a local envoy can also operate it.
You can attach a nominee to your NRO Account.
FOREIGN CURRENCY NON-RESIDENTS FD (FIXED DEPOSIT) ACCOUNTS
This account helps in keeping the foreign currency salary in the same value. This helps to restrain the loss which may incur due to uncertain currency fluctuations.
Features
Such accounts operate just in foreign currency, means you can deposit any currency other than the Indian rupee.
So we can say that sources of funds have to be as of abroad.
Interest earned through such accounts does not lie under any tax slab in India – that is there is no tax charged on the earnings of the account in India.
Interest that is incurred in this account is given in the same currency it is been maintained in.
To make any deposit in these accounts the period will be from 1 year to the highest limit of 5 years.
The FCNR account can be opened jointly with an NRI. Still, opening it in joint name with any Resident of India is prohibited.
Also you can avail facility of getting overdraft on your Current or Savings account against such FCNR Fixed Deposits.
Also that in the FCNR Account you can attach someone as your nominee.
Following are the currencies within which FCNR account could be operated and maintained:
- Canadian Dollars
- EURO
- US Dollars
- Australian Dollars
- Japanese Yen
- Pounds Sterling
It would have been surely difficult for you to be apart from your residential place and snuggle down in any foreign country along with being away from your relatives or parents. Similarly your nearest and dearest also must have gone through same emotions. Not anything can fill the emptiness of your occurrence on various important festivals and occasions but you can as a minimum fulfill your fiscal obligations through such above NRI accounts offered in India consequently giving them a feeling that you are always near them and with them.
