_1751708048.png){kind=small}
_1751707492.png){kind=small}
_1751707439.png){kind=small}
NRI Repatriation is an integral part of the financial management and planning for NRIs. In simple terms, repatriation refers to transferring funds from an Indian bank account to a bank account in a foreign country. NRI repatriation specifically refers to the transfer of funds from your NRI account in India to your bank account in your country of residence.
If you are an NRI living abroad for work, business, or education, this blog is all you need. As an NRI, while living abroad, you need to maintain NRI bank accounts in India for managing fund transfers from India to abroad. This whole process refers to the repatriation of funds, and this blog guide will break down every aspect related to it.
NRI repatriation refers to the transfer of funds from India to a foreign country where the individual resides. Now, to repatriate money from India, you need to maintain two types of bank accounts as an NRI. These bank accounts are NRO, which is a Non-Resident Ordinary account, and the NRE, which is a Non-Resident External bank account. However, you can also have an FCNR (Foreign Currency Non-resident) bank account.
As aforementioned, as an NRI, you need to have at least two types of NRI accounts to repatriate funds from India to your country of residence. Here's a closer look at what each account means and how it operates:
NRO (Non-Resident Ordinary) Account: An NRO account is a non-resident ordinary account specifically for NRIs who earn income in India through dividends, rental income, pension, or other sources. The repatriation of funds from an NRO account must be done in accordance with the regulations set by the RBI, which permits an NRI to repatriate up to USD 1 million in a financial year, after paying all applicable taxes.
It is essential to keep in mind that interest earned on the NRO account is taxable in India; therefore, NRIs must consider all tax implications, settle the tax, and then repatriate the funds.
NRE(Non-Resident External) Account: An NRE account is a non-resident external account that NRIs use to deposit their foreign income in India. Unlike an NRO account, NRIs can easily repatriate the funds from an NRE account, including both he interest earned on it and the principal amount, without any tax implications.
FCNR (Foreign Currency Non-Resident) Account: FCNR account is a foreign currency non-resident account. This type of bank account allows NRIs to keep their earnings or savings in a foreign currency. This account safeguards your savings against exchange rate risks as your deposits are in currencies such as USD, EUR, etc. Like an NRE account, you can fully repatriate the funds, both the principal amount and taxes, from this account without facing any tax implications or set limits.
As an NRI, you can repatriate the income earned through the following means:
As part of regulations set by FEMA and RBI, NRIs must be prepared with certain documents required for the repatriation of funds to ensure a seamless process.
NRIs can choose to repatriate funds from any NRI account they want; however, each account is subject to specific rules and limitations.
| Type Of Income | Repatriation Limit |
|---|---|
| Salary, Investments, Interest, Profits from any proprietorship or business held under the NRE account | No Limit |
| Movable assets balance, sales from assets acquired in India through the legacy, inheritance, or settlement | 1 million USD per financial year |
| Income from immovable assets, like revenue from the sale of the residential property you bought in India, as per FEMA. | 1 million USD per financial year |
You can repatriate funds from the NRO account only after all the due taxes have been paid on the income. The limit is USD 1 million per financial year on revenue from the sale of any immovable or movable asset in India. Income through rent, inheritances, and property sales will be taxed first, and then they will be eligible to repatriate.
You have the full liberty to transfer money from your FCNR account, as it has no repatriation limits, because the deposits made under this account are in a foreign currency source.
FEMA refers to the Foreign Exchange Management Act, which is India's modern law regulating the foreign exchange market. NRIs must be aware of the FEMA regulations before repatriation from India.
Nowadays, NRIs seek investment options in India that can be easily repatriated. Here is a list of such investment options:
Other options to explore include public sector undertaking bonds, the national pension system, and bonds or units issued by infrastructure debt funds.
Repatriation of funds is subject to tax implications, rules, and regulations set by the RBI and FEMA (Foreign Exchange Management Act), making the entire process overwhelming. One needs to have a solid understanding of Indian taxation laws and FEMA compliances to ensure that no penalties are incurred during the process and that all activities occur within regulatory compliance.
For a seamless process, an NRI can hire a tax expert who can provide end-to-end assistance, from repatriation of funds to ensuring every step is done in compliance with taxation laws and FEMA regulations. This is when Savetaxs comes to rescue the NRI. We are a team of expert Chartered Accountants (CA) with over 30 years of experience in NRI taxation and repatriation of funds abroad.
We can assist you through every step of repatriation, including filing Form 15CA and 15CB, providing remittance support, offering expert guidance, and more. With more than a decade of experience, our experts ensure that everything is done exactly as stated by FEMA rules and RBI (Reserve Bank of India) regulations, so that nothing goes otherwise and the funds are repatriated securely and easily.
Speak to our experts and get personalized solutions for your NRI tax needs
View PlanExperts answer questions related to NRI business and entity setup, as well as other related topics.
Yes, Non-Resident of Indians (NRIs) can start a business in India. Not just NRIs, the government of India has also permitted foreign nationals to invest or start a business in India. This is done to attract foreign direct investment (FDI) into the Indian economy. FDIs are necessary for the economic growth of India. In compliance with the Foreign Exchange Management Act, 1999, and FEMA regulations, NRIs can establish their businesses in India.
Yes, Overseas Citizen of India (OCI) can start a business in India as they have the same rights as NRIs have regarding business ownership and operations. However, there are certain exceptions related to certain types of property or agricultural land. In a nutshell, OCIs can participate in partnerships or own a business and register a company in India.
The best bussiness structure entirely depends on what are the goals of the business and what type of domain the Non-Resident of India (NRI) want to deal in. However if you are still not sure about it you can quickly connect with the experts and the legal team of Savetaxs and they will help you with the best structure suitable for your business after understanding the needs, and goals of the business.
Yes, two or more NRIs can jointly register a company in India; however, there are certain companies whose ownership legally requires having a resident of India as well. According to the company type, one must comply with the guidelines set by the Foreign Direct Investment (FDI) policy, as well as those established by the Reserve Bank of India (RBI).
Once the company is registered, there are specific compliance requirements that must be adhered to to operate a legal business in India.
Firstly, you need to have a Permanent Account Number, which is essential for filing returns and conducting financial transactions on behalf of other businesses.
You then need to have GST registered for the company.
If your business plan includes employees and requires salary payments, you must also register for TDS.
Opening of a business bank account, which will be dedicated to managing your company's finances and transactions.
Lastly, you need to adhere to the policies set by FDI, FEMA, and RBI to run a successful business in India.
Our team of CAs and legal experts has over three decades of experience in helping Non-Resident of India (NRI) or foreign nationals set up a business in India.
From a private limited company to a limited liability partnership (LLP), one person company (OPC), partnership form, Liaison, branch, subsidiary offices, and public limited company, we help NRIs set up a business or entity according to their preference.
We also assist NRIs with custom business planning, business accounting services, legal compliance, registrations, taxation services, and obtaining all the necessary permits and licenses.
In brief, we offer a comprehensive package for establishing a successful business or entity in India for NRIs or foreign nationals.
Yes, post-incorporation, Sabetax will help you obtain key tax registrations, such as GST, and more. Apart from this, our experts will also assist you with other necessary compliances, such as opening a business bank account and ensuring everything aligns with FDI, FEMA, and RBI guidelines.
Yes, Savetaxs can help you with FDI and RBI-related compliances for NRIs, and not just that, we also help NRIs with Double Taxation Avoidance Agreements.
We have a team of legal experts with over 30 years of experience in setting up entities and businesses for NRIs and foreign nationals. They have a keen eye on every step to ensure everything happens legally.
Our happy customer base shows our excellence, justifying why NRIs and foreign nationals trust us with their business and entity set-up registrations.
