A major share of Indian population is living outside the country. Most of them usually keep a non-resident external (NRE) or a non-resident ordinary (NRO) accounts in India. Here, a comprehensive elucidation of such accounts and NRE repatriation is explained in detail. Scroll down to read more…
NRE Repatriation
Funds in NRE accounts are most of the time freely repatriable outside India. The balance of the NRE accounts can be transferred only to the account holder’s own account situated abroad. It means the account holder’s name must be the same on both accounts.
Who is an NRI?
A ‘Non-resident Indian’ or NRI is a citizen of India but resides outside the country.
NRE account
NRE account is opened by NRIs in India to deposit their foreign earnings in Indian denomination. It can be in the form of saving, current or fixed deposit or recurring account. The withdrawal from the NRE account is in the form of rupees. This account is subject to currency fluctuations. There is no tax on the principal amount and interest earned. NRE Repatriation is allowed without any limit.
Permissible Credits to NRE account
Credits permitted to this account are inward remittance from outside India, interest accruing on the account, interest on investment, transfer from other NRE/ FCNR (B) accounts, maturity proceeds of investments (if such kinds of investments were made from this account or thru inward remittance).Current income like rent, dividend, pension, interest etc. will be construed as a permitted credit to the NRE account.
TCS applicability
NRE accounts are easily repatriable and do not fall under the Liberalized Remittance Scheme. TCS is not applicable for any Non-Residents sending funds to and from India thru their NRE bank account.
