Reserve Bank Of India the premiere financial regulatory body in India has released a circular on May 7th 2012. According to this NRI's (Non Resident Indians) who currently maintain NRO account with any of the banks present in India can have their funds transferred to their NRE account
This is a gift move much awaited by many NRIs ever since interest rates have been sky rocketing in NRE accounts. According to current rate on an average the investments gets doubled in about 7 years and 5 months to 7 years and 10 months in case of 10 year NRE fixed deposit
NRE has an additional advantage that NRI's dont have to pay a single penny towards Indian Income taxes. However in case of countries like USA , the FBAR law that has come into effect since January 29th 2012 has mandated the declaration of investment and earnings on foreign investment of US residents. It is good to check with your CPA on this
What are the steps to move money from NRO to NRE?
NRO interest income is taxavle in India. Even with DTAA submission tax comes around 15% in case of US residents. Hence it is a good idea to make a move from NRO to NRE.
Though the steps are not properly documented RBI circular states the following facts
1) Transfer of about 1 million USD pr year is permitted
2) Taxes must be paid properly before moving NRO to NRE. TDS deduction is automatic in most banks and this is taken care of by them. Some banks are willing to waive penalty during this move. Please check with your banker to know more details
3) Forms including 15CA, 15CB and A2 must be filled with the help of your auditor in India and we need to submit the same to the bank
Utilize this opportunity to save and grow rich
Following the RBI policy change to transfer money from NRO to NRE account directly without repatriation need forms 15CA and 15CB have become the talk of the tow. So, NRI's who make monthly income abroad make it a habot to transfer funds on a monthly basis. In the case most of them have multiple fixed deposits/special term deposits as banks call it variously opened under their NRO account.
If they wish to proceed with NRO to NRE transfer what should they do? Is it sufficient to submit one 15CA and 15CB form or more forms.
Here is the simple reply from banks on this question
Forms 15CA and 15CB are used for repatriation now in our case transfer from NRO to NRE account (internally referes to savings account as NRO FC to NRE FD is not feasible) on a ONE TIME BASIS
For each and every repatriation we need to provide different 15CA and 15CB forms.
Say you have opened FD's from January to December of last year you need to wait until December (if you wish to take advantage of 1 year interest rate) of this year break all FD's put it onto NRO savings and have this transferred onto NRE in a single shot
If not close FD's from January upto June, put it in NRO savings, transfer money from NRO to NRE savings. Submit one form 15CA and 15CB for this purpose
Wait for further maturity close it one by one, submit 15CA and 15CB for each and every transfer (remittance)
Plan good before you initiate this transfer process
Can I submit Multiple Form 15CA and 15CB during a year?
ARBI has opened gates to transfer money from NRO to NRE account. Since then this is a common topic of discussion. To give a lime light on how to safely transfer your money with minimal loss in interest here are the pointers to be followed
1) Obtain form 15CA from your auditor. Form 15CB and A2 are to be filled by you. Submit all the three documents to your bank
2) In a year we can transfer upto 1 million USD from NRO to NRE account
3) This internally means that we can submit any number of form 15CA and 15CB (multiple submission allowed) considering the fact that the amount to be trnasferred doesnt exceed 1 million USD
Do I need To Submit Form 15CA,15CB for NRO to NRE Transfer?
We have discussed about the RBI circular that permits the transfer of money from NRO ro NRE account. This is high time to save on taxes at India. The next question is about the necessity to submit forms 15CA, 15CB to the bank branch to initiate this transfer.
So, is it needed to submit these documents?
Simple answer is YES. The logic works this way
1) Maximum 1 million USD can betransferred from NRO to NRE per year subject to payment of taxes
2) The user can choose to initiate transfer from NRE - This money needs to be properly validated by bank
RBI has clearly specified that the steps are the same as NRO repatriation onto foreign account except that it is a local NRE account
So, can I transfer my NRO FD's to NRE FD's?
Simple answer is it may be not possible. NRO savings to NRE savings is the possible way to have this transfer.
Talk to your bank manager and auditor to start next steps
This is a gift move much awaited by many NRIs ever since interest rates have been sky rocketing in NRE accounts. According to current rate on an average the investments gets doubled in about 7 years and 5 months to 7 years and 10 months in case of 10 year NRE fixed deposit
NRE has an additional advantage that NRI's dont have to pay a single penny towards Indian Income taxes. However in case of countries like USA , the FBAR law that has come into effect since January 29th 2012 has mandated the declaration of investment and earnings on foreign investment of US residents. It is good to check with your CPA on this
What are the steps to move money from NRO to NRE?
NRO interest income is taxavle in India. Even with DTAA submission tax comes around 15% in case of US residents. Hence it is a good idea to make a move from NRO to NRE.
Though the steps are not properly documented RBI circular states the following facts
1) Transfer of about 1 million USD pr year is permitted
2) Taxes must be paid properly before moving NRO to NRE. TDS deduction is automatic in most banks and this is taken care of by them. Some banks are willing to waive penalty during this move. Please check with your banker to know more details
3) Forms including 15CA, 15CB and A2 must be filled with the help of your auditor in India and we need to submit the same to the bank
Utilize this opportunity to save and grow rich
Following the RBI policy change to transfer money from NRO to NRE account directly without repatriation need forms 15CA and 15CB have become the talk of the tow. So, NRI's who make monthly income abroad make it a habot to transfer funds on a monthly basis. In the case most of them have multiple fixed deposits/special term deposits as banks call it variously opened under their NRO account.
If they wish to proceed with NRO to NRE transfer what should they do? Is it sufficient to submit one 15CA and 15CB form or more forms.
Here is the simple reply from banks on this question
Forms 15CA and 15CB are used for repatriation now in our case transfer from NRO to NRE account (internally referes to savings account as NRO FC to NRE FD is not feasible) on a ONE TIME BASIS
For each and every repatriation we need to provide different 15CA and 15CB forms.
Say you have opened FD's from January to December of last year you need to wait until December (if you wish to take advantage of 1 year interest rate) of this year break all FD's put it onto NRO savings and have this transferred onto NRE in a single shot
If not close FD's from January upto June, put it in NRO savings, transfer money from NRO to NRE savings. Submit one form 15CA and 15CB for this purpose
Wait for further maturity close it one by one, submit 15CA and 15CB for each and every transfer (remittance)
Plan good before you initiate this transfer process
Can I submit Multiple Form 15CA and 15CB during a year?
ARBI has opened gates to transfer money from NRO to NRE account. Since then this is a common topic of discussion. To give a lime light on how to safely transfer your money with minimal loss in interest here are the pointers to be followed
1) Obtain form 15CA from your auditor. Form 15CB and A2 are to be filled by you. Submit all the three documents to your bank
2) In a year we can transfer upto 1 million USD from NRO to NRE account
3) This internally means that we can submit any number of form 15CA and 15CB (multiple submission allowed) considering the fact that the amount to be trnasferred doesnt exceed 1 million USD
Do I need To Submit Form 15CA,15CB for NRO to NRE Transfer?
We have discussed about the RBI circular that permits the transfer of money from NRO ro NRE account. This is high time to save on taxes at India. The next question is about the necessity to submit forms 15CA, 15CB to the bank branch to initiate this transfer.
So, is it needed to submit these documents?
Simple answer is YES. The logic works this way
1) Maximum 1 million USD can betransferred from NRO to NRE per year subject to payment of taxes
2) The user can choose to initiate transfer from NRE - This money needs to be properly validated by bank
RBI has clearly specified that the steps are the same as NRO repatriation onto foreign account except that it is a local NRE account
So, can I transfer my NRO FD's to NRE FD's?
Simple answer is it may be not possible. NRO savings to NRE savings is the possible way to have this transfer.
Talk to your bank manager and auditor to start next steps
