7 Tips and NRE account rules that every NRI must know
New Delhi (India), August 31: As soon as you change your status to Non-Resident Indian (NRI), one of the following financial steps is to open an NRE/NRO account. While both serve your purpose, the NRE (Non-Resident External) account that allows you to maintain your foreign income in Indian rupees is fully repatriable and offers tax-exempt interest.
However, here are seven tips serving as NRE account rules that will help you avoid common pitfalls. To make the most of your NRE account, you should know its terms.
Apart from offering high liquidity, some of the key features of NRE accounts include – - Tax-exempt interest - Complete repatriation of funds - Allows to deposit foreign earnings in INR - Facilitates investments in the capital market - Offers global access through online banking and international debit cards By familiarizing yourself with these features, you can leverage your account to the fullest while staying connected to your Indian roots. One of the most essential benefits of NRE accounts is their tax exemption with respect to the principal and interest accrued on them in India.
However, other investments and income sources, including capital gains and rent from India, might have different tax implications and funds from these sources can be deposited in the NRO (Non-Resident Ordinary Account). Similarly, don’t forget to verify the taxation of interest in your country of residence, as this rule for NRE accounts may differ depending on your country’s tax laws.
Adhering to the guidelines for NRE accounts, involves regularly monitoring transactions of your accounts. You should stay updated with incoming and outgoing funds, ensuring that your account activities are in line with the guidelines prescribed for NRI
. Read more on livemint.com
