Here, we will answer viewer questions on income tax, NRE and NRO accounts
Check out NRI Q&A 2020 playlist which contains all presentations made in 2020
The links are provided in the description section
Answering the questions will be Chhavi Prabharkar, CEO and Co-Founder, Global Indian Solutions
Which provides a host of financial solutions to NRIs
You can reach Global Indian Solutions by clicking on the link in the description section
Deepak Kumar asks whether he needs to file ITR. He is working outside India and is an NRI
Tony Kalirai asks where does an NRI from UK pay their income tax
Akash Patel wants guidance on how to get refund on TDS from NRO account
Navneeta Krishnan wants to know about the taxation of NRE and NRO funds transfer
Today, we will discuss questions related to tax implications
Basically, how you can efficiently manage your assets in India
There are two types of bank accounts NRIs are allowed to keep in India
This arrangement is to help you segregate the funds you get from abroad i.e funds earning as NRI
For that, the relevant account is the Non Resident External Account or NRE account
NRE account is not taxable in India
Income earned in the account and the fixed deposit or FD is not taxed in India
The other account NRIs should be having Non Resident Ordinary account
NRO is meant for Indian rupee credits
While you can credit the account with foreign funds
But since the income from the account is taxed in India
Therefore, it is always advisable to keep your overseas funds that you are getting into India, separate
In the NRE account and you park Indian rupee funds in the NRO account
Income made from money in NRO savings account and fixed deposit (FD), Tax Deducted at Source (TDS)
This is done at the rate of 30% and other applicable surcharges and cess
So, it is advisable that these funds are managed efficiently
Even if you don't have substantial income in India, you must have a PAN card
While a PAN card is not mandatory, it is advisable to have it since it helps you claim tax refund
So, this covers income from funds in NRO account, rental income, dividend income etc
Basically all incomes from India that will go into your NRO account
Since there is a TDS on income from NRO account and if your annual income doesn't cross Rs 2.5 lakh
Then, you must get the tax refund on the tax deduction at source i.e TDS
For that, the PAN card is a must
PAN card can be done when you are in India or it can be done online
Any NRI can file income tax return. It can be done online or they can take help of any expert
The procedure for filing income tax return is the same as that for resident Indians
Any time you are remitting money from overseas, do it on your Non Resident External (NRE) account
NRE account can be rupee denominated
But you also have the option of money in foreign currency
This can be in the form Foreign Currency Non Resident Deposits or FCNR deposits
This is another option you can use if you don't want to convert the money
At any point of time, money can be repatriated overseas
Since there is no tax implication for NRE account, any money can be converted back into foreign currency
In NRO account, the money can also be repatriated but you need to ensure that applicable tax is paid
On the income paid and you need to have a certificate from the authorised dealer--the bank in this case
The certificate and declaration from the bank needs to be given
The money can be repatriated or moved to your NRE account
This is a completely repatriable account