Material Content for CAIIB - REMITTANCE FACILITIES FOR NRI/PIO/FN

CAIIB - REMITTANCE FACILITIES FOR NRI/PIO/FN

REMITTANCE FACILITIES FOR NRI/PIO/FN

 

Non Resident Indians (NRIs)/Person of Indian Origin (PIO)

  • Non-Resident Indian (NRI) means a person resident outside India who is a citizen of India. Person of Indian Origin (PIO) means a citizen of any country other than

 

Bangladesh or Pakistan who had:-

a) at any time held Indian passport or

b) he or either of his parents or any of his grandparents was a citizen of India by virtue of the Constitution of India or the Citizenship Act, 1955 or

c) the person is a spouse of an Indian citizen or a person referred to in (a) or (b).

 

Remittance facilities available to NRI/PIO/FN

 

  1. Repatriation of current income like rent, dividend, interest, etc. in India of NRI/PIO who do not maintain a NRO account, can be repatriated based on CA’s certification re. eligibility and payment of applicable taxes/provided for.
  2. NRIs/PIO have the option to credit the current income to their NRER account, to the satisfaction of the bank (AD).
  3. Foreign nationals who come to India on employment and become residents are permitted to re-designate their resident account maintained in India as NRO account on leaving the country after their employment to enable them to receive their legitimate dues subject to certain conditions.
  4. A foreign national (FN) of non-Indian origin who has retired from an employment in India or who has inherited assets from a person resident in India or who is a widow of an Indian citizen who was resident in India, can be permitted to remit an amount not exceeding USD 1 Mn. per financial year (April-March) by the bank based on the supporting documentary evidence there against.
  5. These remittance facilities are not available to citizens of Nepal and Bhutan.
  6. A NRI/PIO is permitted to remit an amount to the extent of USD 1 Mn. per financial year from his NRO account/sale proceeds of assets (inclusive of assets acquired by way of inheritance or settlement) as also sale proceeds of immovable property purchased by him out of Rupee funds (or as a person resident in India) without any lock-inperiod.
  7. The remittance facility in respect of sale proceeds of immovable property is not available to citizens of Pakistan, Bangladesh, Sri Lanka, China, Afghanistan, Iran, Nepal and Bhutan and the remittance facility in respect of sale proceeds of other financial assets is not available to citizens of Pakistan, Bangladesh, Nepal and Bhutan.
  8. A foreign national resident in India and employed in a foreign company on deputation to its office in India or being an employee of a company incorporated in India is permitted to remit whole of his salary to his foreign currency account maintained outside India provided applicable tax is paid as accrued in India.
  9. A citizen of India, employed by a foreign company outside India and on deputation to its office in India is permitted to open, hold and maintain a foreign currency account with a bank outside India and receive the whole salary payable to him for the services rendered to the office in India provided applicable tax is paid as accrued in India.
  10. Repatriation of sale proceeds of residential property (max. 2 properties) purchased by NRI / PIO is permitted to the extent of the amount paid for acquisition of immovable property in foreign exchange received through banking channels. The balance amount can be credited to NRO account and repatriated under the USD 1 Mn. facility.
  11. Bank (AD) may permit repatriation of the amount of refund of application/earnest money/ purchase consideration, etc. on account of non-allotment of flat / plot /cancellation of bookings together with interest, if any (net of income tax payable thereon) provided the original payment was made out of NRE/FCNR (B) account of the account holder, or remittance from outside India through normal banking channels. Such funds can also be credited to the NRE / FCNR (B) account of the NRI / PIO, if they so desire.
  12. Banks may allow repatriation of sale proceeds of residential accommodation purchased by NRIs/PIO out of funds raised by them by way of loans from the authorized dealer banks/housing finance institutions to the extent of such loan/s repaid by them out of foreign inward remittances received through normal banking channel or by debit to their NRE / FCNR (B) accounts.

 

Facilities for students

 

  • Students going abroad for studies are treated as Non- Resident Indians and are eligible to receive remittance from India:-

a) Upto USD 0.10 Mn. from close relatives in India on self declaration towards maintenance which could include remittance towards their studies also;

b) Upto USD 0.10 Mn. out of sale proceeds of assets/balances in their NRO account maintained with the bank in India; and

c) Upto USD 0.20 Mn. per financial year under the Liberalized Remittance Scheme.

 

  1. All other facilities available to NRIs under FEMA are equally applicable to the students. Educational and other loans availed by them as residents in India would continue to be available as per FEMA regulations.

 

International Credit Cards

 

Banks (AD) have been permitted to issue International Credit Cards to NRIs/PIO without prior approval of the Reserve Bank. Such transactions may be settled by inward remittance or out of balances held in the cardholder’s FCNR (B) / NRE / NRO accounts.

 

 

Source: RBI M. Circular

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