As per Income Tax:
Based on the number of days of stay in India.
As per FEMA:
Based on the number of days of residing and the conduct intention of the person.
Eligibility for Overseas Citizen of India. (OCI):
Based on conclusive tests for claiming OCI eligibility.
As per Citizenship:
Based on Citizenship Act.
Who is an NRI for Banking & Investment purposes?
As per FEMA (Foreign Exchange Management Act), a person RESIDENT IN INDIA is:
A person residing in India for more than 182 days during the course of preceding financial year but does not include
i) A person who has gone out of India or who stays outside India, in either case
- for or on taking up employment outside India; or
- for carrying on a business or vocation outside India; or
- for any other purpose, in such circumstances as would indicate his intention to stay outside India for an uncertain period.
ii) A person who has come to or stay in India, in either case, otherwise than –
- for or on taking up employment inside India; or
- for carrying on business or vocation in India, or
- for any other purpose in such circumstances as would indicate his intention to stay in India for an uncertain period.
Banking Regulations for NRI:
- NRI are not allowed to keep Resident Indian savings account in India under FEMA.
- Either the resident savings account is to be closed or converted in NRO account.
TYPES OF BANK ACCOUNT:
- NRO Account
- NRE Account
- FCNR Account
- RFC Account
NRO Account (Non Resident Ordinary Account):
- Non repatriable rupee account.
- When Resident Indian becomes NRI his existing account changes to NRO banks need to be informed.
- Credits and debits of Non repatriable funds.
- The income from the account is taxable under Income Tax.
- Joint account with another NRI OCI or with resident can be opened.
- Loan available against this account in Indian Rupees.
NRE Account (Non Resident External Account):
- Remittance from abroad or other NRE or FCNR Accounts.
- Balance held in rupees but are repatriable.
- Proceeds on maturity of repatriable assets can be credited.
- Foreign exchange can be credited by NRI himself.
- The income from the account is exempted from Income Tax.
- Loan can be availed against the balances in this account, in Indian Rupees.
- Joint account with another NRI/OCI or with resident relative can be opened.
FCNR Account (Foreign Currency Non Resident Account):
- Deposits in specified foreign currencies (Savings bank account not available).
- Different Interest rates for holding deposits in different currency. Swap between currencies possible.
- Transfer to NRE and vice versa possible.
- The income from the account is exempted from Income Tax.
- Loan can be availed against the balances in this account, in Indian Rupees and
specified foreign currency. - Joint account with another NRI OCI or with resident relative can be opened.
RFC Account (Resident Foreign Currency Account):
- This account can be maintained in form of savings bank account as well as term deposits by returning NRIs.
- There is no maximum time limit for holding RFC savings bank account and term deposits.
- This account can be opened and maintained in any convertible foreign currency.
- Loan not available against this account.
- Credits of foreign exchange assets, NRE FCNR balances.
