NRI living may be having passive income sources from India such as Rental income , capital gain , Interest income , investment returns etc. NRI sending money abroad from India is called as Repatriation of funds. Repatriation of funds can be done online via using banking channels and meeting legal formalities. To help NRI to transfer funds out of India RBI allows an amount of upto USD 1 million per financial year. If the NRI brings in money from abroad to repay the home loan amount taken to buy the property, the bank from which he took the loan will allow him to freely repatriate an equivalent amount to what was brought in the country from abroad.
Indian government introduced various measures like such as PM Gati Shakti, single window clearance, GIS-mapped land Bank, reduced corporate tax rates, Make in India initiative to encourage foreign investment. But on the other hand, rules and regulations for NRI repatriation of funds from India are very strict, complex which makes process time-consuming and lengthy.
Repatriation of NRI funds refers to transferring funds from India to NRI’s country of residence (by way of bank account). Repatriation of funds by NRI should be made according to guidelines of Foreign Exchange Management Act (FEMA) , Reserve Bank of India (RBI), or any other applicable law as case may be.There are different types of accounts available for investment for NRI such as -NRE account, NRO account and FCNR account. In this article we will have complete guidance on repatriation of funds of NRI from India.
What is NRE Account?
Non Resident External (NRE) account is an account used to park your foreign earnings in Indian rupee denomination. So, it can also be referred to as an Indian rupee denominated account.
Provisions regarding repatriation of funds from NRE account:
List of Documents required for repatriation of funds from NRE account:
What is NRO Account?
Non-Resident Ordinary account is a popular account used by NRI to manage their deposit or income earned in India.Main feature of the account is, It is possible to receive funds in any foreign / indian currency in this account. But for withdrawal only Indian currency is allowed.
Provisions regarding repatriation of funds from NRO account:
List of Documents required for repatriation of funds from NRO account:
You are required to self attest and e-mail self attested copies to bank with request to proceed repatriation. When request is processed , you can repatriate your funds.
What is FCNR Account?
This account is mainly used for purpose of mking fixed deposit investment of foreign currency. Benefits of this account are- interest is tax free and gives protection from currency fluctuations.
Provisions regarding repatriation of funds from FCNR account:
List of Documents required for repatriation of funds from FCNR account:
Once remitter fill these required forms nd submit it to bank, process of repatriation will get approved and start.
In India, if any NRI wants to repatriate money from India to his country of residence , then specific prescribed repatriation guidelines and limits applicable are to be complied. Such prescribed limits for different typesa nd sources of income are-
|Sr. No.||Nature of income to be repatriated||LImit for Repatriation by NRI|
|1||Current income (in nature of salary,pension, interest,dividend,rent ,etc.) of Past year or current year||No limit|
|2||Repatrition of capital funds by NRI except from immovable property (eg- capital funds held in fixed deposits, mutual funds, shares,etc. including inheritnce)||USD 1million per financial year|
|3||Repatrition of capital funds by NRI from immovable property (other than agri land, farm house)-|
|3a||Property purchased in foreign currency:-
|Full sale proceeds are free to repatriate.
Only incaseof residential property, repatriation of funds by NRI from maximum 2 residential properties in India is allowed.
|3b||Property purchased other than foreign currency:-||USD 1million per financial year|
If NRI want to repatriate in excess of above mentioned limit , thenRBI approval is required.RBI can approve the enhanced limit if satisfied with cause and documnetstion bt remitter. Also, incase of emergencies like medical emergency, education,etc. RBI may extend repatriation limit.