The process of transferring funds from NRI’s Indian Bank account to the bank of his residence country is known as repatriation. NRIs can hold Non-Resident External, Non-Resident Ordinary and Foreign Currency Non-Resident bank accounts with RBI-authorised dealers/banks. There is no limitation on the repatriation of funds from the NRE account, but there is a limitation on remitting up to 1 million USD per financial year from the NRO account. Various documents, such as; Remittance Form, Form A2, Form 15 CA Form-15 CB, etc., must be submitted to repatriate funds.
1.
What types of Bank Accounts can be held in India by an NRI or a PIO?
Tax Implications on Repatriation of Funds
NRI can repatriate any amount from his NRE Bank account balance without limit. However, for repatriation through the NRE account, you need to fill Bank request form and Form A2.
The RBI has issued guidelines for the repatriation of funds by NRIs. These guidelines are as follows:
NRI can repatriate up to USD 1 million in a financial year from his NRO account. Sale proceeds of assets acquired by inheritance, settlement deeds, etc., are also included in this amount.
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As per FEMA guidelines, the sale proceeds of immovable assets bought in India by an NRI can be repatriated up to USD 1 million in one financial year.
Repatriation of funds is subject to tax implications. You can repatriate your current income either in the current or NRO account must not hold borrowed funds or funds transferred from any other NRO account subsequent financial year.
There is a limit of USD 1 million for repatriation from the NRO account, and no such limitation is imposed on the NRE account. You can only repatriate sale proceeds maximum of two properties in India.
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The RBI guidelines and FEMA rules on the repatriation of funds ensure that NRIs can repatriate their funds from India for legitimate purposes. The guidelines also help to prevent the misuse of foreign exchange by NRIs. However, repatriation of funds is a complex matter you should consult with a tax advisor for guidance.
