Understanding NRO Account Repatriation Rules

There are primarily two types of NRO Accounts - NRO Savings Account and NRO Fixed Deposit. Both the accounts allow NRIs to manage income earned in India and facilitates easy transactions in Indian rupees. However, is the amount fully repatriable? Before we answer this question, let's understand what repatriation means.

When it comes to repatriation from an NRO account, there are certain rules and limits that need to be followed. As per FEMA mandate, NRO Account holders can fully repatriate only the interest amount. The principal amount that can be repatriated is limited to USD 1 million per financial year. It's important to note that the interest earned on NRO Account is subject to TDS (Tax Deducted at Source). Currently, the interest earned via NRO Account is taxed at 30% - additional Cess is levied.

As an NRI, you can repatriate various sources of income from India. Some of these income sources include:

• Funds held in India before moving abroad
• Inherited funds in India
• Income from Indian assets (rent, dividends, etc.)
• Funds transferred to India as overseas remittances

These repatriable funds can be transferred back to your overseas account, subject to certain limitations and compliance with taxation laws.

Let's consider an example where you received an inheritance of ₹50 lakh in India. After taxation of let's say ₹10 lakh, you would be eligible to repatriate the remaining amount of INR 40 lakh (USD equivalent). However, in instances where the principal amount exceeds USD 1 million, you will be able to repatriate only up to USD 1 million in that financial year.

To initiate the repatriation process from your NRO Account, you need to provide certain documents to your bank. Here are the documents required:

• A request to your bank for initiating the repatriation process
• Form A2, which needs to be filled and submitted to the bank
• Form 15CA, which is used to self-declare payment details liable for taxes in India
• Form 15CB, an affirmation from a Chartered Accountant confirming tax clearance on repatriated funds

Additionally, you may need to submit self-attested copies of relevant documents.

Navigating NRO Account repatriation rules for NRIs requires a thorough understanding of FEMA guidelines and compliance with tax obligations. By adhering to the rules and limits set by the regulatory authorities, NRIs can ensure a smooth transfer of non-resident repatriation from their NRO Accounts.

Explore NRI Accounts with Ujjivan SFB. Select from NRE and NRO FDs and Savings Accounts and enjoy a seamless banking experience from abroad. Alternatively, you can browse through Ujjivan SFB product suite - our wide range of financial products are designed to make your financial life better.