USA - FAQ's

NRI's - Bank Accounts

Are any tax concessions available to NRIs on balances/deposits held in NRE/FCNR accounts?
Yes. Income from interest on funds held in NRE/FCNR accounts is exempt from Income-tax.

Are similar concessions available in respect of balances held in NRO accounts?
No.

What are the tax benefits to the NRNR deposit account holders?
They enjoy the following tax benefits:-

i) Income from the deposits will be free from Indian Income-tax.
ii) The deposit will also be exempt from Gift tax for one-time gifting (in the case of NRIs (only).
iii) Exemption from Income-Tax will not be available to resident donee and those residents, who being joint holders, become owners of the deposit as survivor of the non-resident depositor.

What is the approved method of sending remittances into India?
The approved method of sending remittances into India is through normal banking channels.

At what rates are remittances in foreign currencies made by NRIs converted by banks into rupees?
Such remittances will be converted by banks at the market rate of exchange.

Can remittances be sent into India otherwise than through the medium of a bank in the country of residence of the remitter?
Yes. Exchange Houses in the Gulf countries have been permitted to send remittances into India by means of DDs, MTs and TTs drawn on banks in India.

Can Exchange Houses draw drafts in foreign currencies?
Yes. Exchange House can draw drafts in U.S. dollar or Pound sterling on a limited number of branches of the drawee bank in India, if they have entered into such an arrangement with the drawee bank.

Can NRIs take out of India precious stones or jewellery purchased by them during their visit to India?
Yes. NRIs can take out of India precious stones and jewellery (both gold and non-gold) purchased by them in India, without any limit, provided the purchase is made against payment in any convertible foreign currency.

Can assets held in India by NRIs prior to their becoming non-resident be repatriated outside India?
No.

Can NRIs take out of India household articles such as carpets, curios, etc., purchased out of funds in NRO accounts during their temporary visit to India?
Yes. RBI permits on application such requests received from NRIs up to the value of Rs.20,000 for such articles (other than those made of gold or silver or those banned for exports).

Can NRIs settle their hotel bills in India in Indian rupees?
Yes.

Whether the pension payable in India to NRI can be remitted?
Yes. Authorised dealers can permit remittance of pension to NRIs provided the person concerned has no other income in India. If, however, the NRI has any other income in India, the amount of pension should be credited to his NRO account and his net income including pension is allowed to be remitted after payment of applicable taxes.

Can NRIs obtain rupee credit cards in India?
Yes. NRIs can obtain rupee credit cards valid for use in India, Nepal and Bhutan.

Note:- The exemptions from the provisions of tax are governed by the applicable tax laws of the Government of India as amended from time to time.