5 Things You Must Consider Before Opening An NRO Account

[Shashank Bhaskar]

People from India travel abroad for better opportunities and settle there. They have many responsibilities towards their occupation, lifestyle, and their family living in India. Money can help face the toughest of situations and improve lifestyle. But as an NRI, you need to learn how to save it and send money to your family in India.

When a resident Indian becomes an NRI, they can use the simplest way to access and operate their investments and money in the country of origin. You can convert the savings account with the Indian bank into an NRO account. You can receive foreign remittances, open a joint account with a resident Indian, and repatriate funds abroad up to a specific limit.

Here are the facts about the account:

1. Foreign remittance: As a bank customer, you have the option of opening and accessing NRO online. You can access your money and investments in India and receive foreign remittance with a joint holder having resident Indian status. You can also repatriate funds abroad with a transfer limit annually. 

2. Residential status: To open any non-resident account in India’s banks, you need to provide documentary proof that you are now a non-resident as defined by the Indian tax laws. Once you become an NRI, you cannot continue holding bank accounts with resident Indian status. 

3. Documents required: The conversion of a resident account into a non-resident account requires you to submit identity proof, NRI evidence status, proof of foreign address, and some photographs. 

4. NRI status and residence proof: If you plan to open an NRO account India, you need to provide proof of residence abroad like employment details, student status, dependent visa status, or a copy of a residence permit in an overseas destination. This proof requires attestation by the Indian embassy, notary, or an Indian bank with an overseas branch. 

5. Attestation: As an applicant of an NRO bank account, if you want to mention a local Indian address for ease of operation in addition to the overseas address, you need to submit proof along with attestations.

Remember that you are not exempt from paying taxes in India on your account’s earnings, unlike NRE accounts. The income you earn as interest is taxable as per the Indian Income Tax Act. You can also repatriate the interest income without restrictions. The balance outstanding in the NRO bank account, excluding the interest income, is subject to prescribed limits.