Money transfers /Repatriation of non-repatriable earnings and NRO Account available balances:

While under FEMA Act, 1999 NRI’s non-repatriable current earnings, like rental, dividends, insurance, Interest on NRO investment, etc. attributed to the NRO account, is now completely repatriable subject to reasonable tax payment/deduction.NRIs that do not hold an NRO account is also given such facilities.

In every financial year, a non-resident Indian[NRI], as well as a Person of Indian Origin [PIO], may also liquidate up to US$ 1 million out of the sum retained in the NRO account. These amount in NRO accounts liable for repatriation may have been proceeds of selling of immovable property;

Assets gained by Inheritance / Legacies; NRO investments in a bank or company; the balance of the Provident Fund or Superannuation benefits; the sum of premiums on insurance premium or maturities; proceeds from the sale of stocks, securities; balance retained with partnerships or sole proprietor organizations, etc.

Money transfers shall be permitted for any lawful reason or solely on the grounds of repatriation outside India.

We provide hybrid repatriation advisory services that would include:-

1. Collection of the Actual facts Position.
2. Information and relevant Documents ( as per Annexure A which is mention below )
3. Chartered Accountants in India Certificate i.e. 15CA and 15CB certificate as required by law for taxation purposes.
4. sufficient follow-up with financial institutions

Non-resident Indians are required to remit specific salaries and principal sums that have not been repatriated to far outside India. These would be the following:

1. Repatriation of previously non-repatriable money, such as rent, NGO tax; tax on loans/deposits, etc.

• The Foreign Exchange Regulations Act, 1973 laid out specific guidelines and procedures for repatriation of almost all income produced in India which was listed as non-repatriable. This included rental profits, corporate interest, the share of joint firms, interest on debts, etc.
• The Foreign Exchange Management Act, 1999 did not lay down a specific clause in this regard, although the provisions of the Foreign Exchange Management (Deposit) Regulations, 2000 clearly state ‘remittance outside India of the current income of the account holder net of the applicable taxes.’
• Consequently, the Indian Reserve Bank empty Circular is dated. 14 May 2002 clarified/advised the banker to allow the repatriation of NRI’s current income, such as rent, dividend, pension, interest, etc., from the NRO account and/or credit of such income to the NRE account and, in the case of NRI’s which may not be maintained by the NRO account, RBI directed to obtain the prescribed certificate :
• Suitable certificate of the Chartered Accountant certifying the eligibility of the planned remittances and
• In fact, certifying that the necessary tax has been compensated/provided for.

2. Sale of household property funds raised:

• Selling proceeds of household properties were, until then, repatriable to the sum of foreign currency equal purchasing price/acquisition rate, given that NRI had purchased such properties and retained such property for a period of 3 years and had acquired the same proceeds from balances kept in Non-Resident Local (NRE)/Foreign Currency Non-Repatriable (FCNR) or by foreign exchange remittances from abroad.
• The requirement for a minimum holding period of 3 years has been removed by the RBI. Any event of selling house land, regardless of the length of the possession, would be liable for repatriation benefits subject only to limitations on repatriation of 2 residential properties.

3. Balances kept in a non-resident non-repatriable account-NRNR:

• By then, the total amount of the deposit kept in the Non-Resident Non-Repatriable (NRNR) account was non-repatriable.
• The sum of interest gained from the tax allowance as well as full repatriation.
• all balances in the NRNR account were granted the benefit of repatriation.
• As a consequence, earnings from deposits reaching maturity on or after 1 April 2002 will be credited to the Non-Resident External Account (NRE) of the owner of the NRI account, which may be held as such or shifted to the Foreign Currency Non-Resident Account or remitted/repatriated abroad.

4. NGO repatriation balance up to US$ 1 million:

• NRIs are permitted to repatriate/return abroad up to US$ 1 million per financial year out of the amount kept in the Non-Resident Ordinary Account [NRO], which is, per se, non-repatriable.
• This amount was to be made out of valid transactions allowed at the appropriate time under the foreign exchange legislation applicable to the FERA Act, 1973, FEMA Act, 1999
• NRIs requesting repatriation is required to apply to the Authorized Dealer in particular ways, along with documentation respecting the origins of the NGO balances and paying the tax in place, as well as the Chartered Accountant’s Certificate of regulatory compliance necessary and payments respectively.

We also support tax calculation assistance; tax payments; submitting of tax filings and financial planning in this and many other matters;

Regards

India Financial Consultancy Corporation Pvt Ltd.(IFCCL)

www.caindelhiindia.com

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