NRI PROVISION

NRI PROVISION

Return 2 India'' is much cherished dream but the fears re: ''can or cannot continue'' or say ''to or not to disclose overseas assets'' are most dreaded ones. Fortunately NRIs returning home for settlement can happily "keep the cake and eat it too". Returning NRIs can freely continue to hold overseas movable as also immovable assets; maintain foreign currency accounts in India and also earn tax free income in India & abroad.

NRIs returning home come back with lot of hopes, anxieties, uncertainties - quite often not sure about their settlement plans-mis-information re. rules & regulations, all add to complete a perfect picture of confusion, despair & doubts. Fortunately Foreign Exchange Laws, Tax Laws & Banking Regulations for Returning NRIs, viewed from a correct perspective, are absolutely simple and liberal.

The same are discussed hereunder :
Movable Assets Abroad

Immovable Assets Abroad

Bank Accounts Abroad

Bank Accounts in India

Shares and Securities in India

Other Assets in India
All the above topics are explained in simple language together with:

01
Copy of relevant Section / Regulation of the Act.

02
Copy of relevant Notification, Circular or Press Release.

03
An example in case of intricate provisions is created recognizing these confusions and doubts - an attempt to give a correct perspective of ;

[ I ] Foreign Exchange Regulations as regards :

01
bank accounts in India i.e. NRE, FCNR(B), RFC & NRO A/c. etc.

02
continuation of State Bank of India's Resurgent India Bonds (RIBs) and India Millennium Deposits (IMDs),

03
Overseas bank accounts, movable assets & immovable assets abroad.

04
other assets in India,
and also

[ II ] Tax Provisions pertaining to Returning NRIs as regards :

01
bank accounts in India,i.e. NRE, FCNR(B), RFC & NRO A/c. etc.

02
interest income of State Bank of India's RIBs and IMDs.

03
Overseas income.

[III] Wealth Tax as regards :
01 Indian assets, 02 exemptions under Wealth Tax. femaonline.com - is one of its only kind of website displaying most updated Foreign Exchange Management Regulations - updated almost everyday. The website also has special corners for Non Resident Indians (NRIs), Returning NRIs and Bankers.

Although, the content of the website can be viewed by registered users only, we welcome you to a preview of detailed contents of " Returning NRI's Bank Accounts in India - [FCNR(B)] "
Returning NRI's Foreign Currency Non Resident (B) - [FCNR-(B)]

1.
An NRI upon his return to India for settlement, i.e. taking up employment, carrying on business or profession or any purpose indicating intention to stay in India for uncertain period holding an FCNR(B) account .

01
can continue such deposit uptill maturity; . at contracted rate of interest & other terms if he so decides. .

02 Upon maturity, returning NRI is required to : i)

convert the FCNR(B) deposit to Resident Foreign Currency Account (RFC), or ii)
convert the FCNR(B) deposit as Resident account.
2.
Definitions :

01.
"FCNR(B) Account" means a Foreign Currency Non-resident (Bank) account referred to in clause (ii) of sub-regulation (1) of Regulation 5
[Para 2(v) of F.E.M. (Deposit) Regulations, 2000 ]2

02.
" Non Resident Indian ” for the said chapter means a person of Indian origin being an Indian citizen or a foreign citizen who is residing outside India.
[Para 2(vi) of F.E.M. (Deposit) Regulations, 2000 ]3

Recently RBI has clarified that students studying abroad also be treated as NRIs under FEMA and accordingly be eligible for foreign investments and NRE/FCNR a/cs

03.
"Overseas Corporate Body " means a Company, Partnership Firm, Society etc. wherein 60 % or more ownership lies with NRIs or a Trust wherein 60 % or more financial interest is irrevocably held by NRIs.
[Para 2(xi) of F.E.M. (Deposit) Regulations, 2000 ]4

04.
"Person of Indian Origin" means an Indian citizen or a foreign citizen who;
i) at any time held an Indian Passport, or ii) himself or his parents or grand parents were citizens of India, or iii) is a spouse of an Indian citizen, or iv) is a spouse of person referred to in (i) or (ii) above. [Para 2(xii) of F.E.M. (Deposit) Regulations, 2000 ]5