Who is a Non-Resident Indian (NRI) ?
'Non-resident Indian' is an individual who is a citizen of India or a person of Indian origin and who is not a resident of India. Thus, in order to determine whether an Individual is a non-resident Indian or not, his residential status is required to be determined under Section 6. As per section 6 of the Income-tax Act, an individual is said to be non-resident in India if he is not a resident in India and an individual is deemed to be resident in India in any previous year if he satisfies any of the following conditions:
1. If he is in India for a period of 182 days or more during the previous year; or
2. If he is in India for a period of 60 days or more during the previous year and 365 days or more during 4 years immediately preceding the previous year.
However, in respect of an Indian citizen and a person of Indian origin who visits India during the year, the period of 60 days as mentioned in (2) above shall be substituted with 182 days. The similar concession is provided to the Indian citizen who leaves India in any previous year as a crew member or for the purpose of employment outside India.
Who is a Person of Indian Origin (PIO) ?
A person shall be deemed to be of Indian origin if he, or either of his parents or any of his grand-parents, was born in undivided India.
Other terms with vaguely the same meaning are overseas Indian and expatriate Indian. In common usage, this often includes Indian-born individuals (and also people of other nations with Indian ancestry) who have taken the citizenship of other countries.
Can an NRI maintain a bank account in India?
Yes. NRIs can maintain accounts in rupees as well as in foreign currency.
What type of Bank accounts can an NRI open ?
NRIs can open the following types of account :-
1. NRE (Non-Resident External Account)
NRE is one of the many types of NRI bank accounts. NRIs use it to transfer foreign earnings to India. With this account, you can deposit money in a foreign currency and freely repatriate back to your country of residence. Once the money is deposited in foreign currency, it is converted into INR. You can subsequently maintain and withdraw funds in INR. An NRE account is available in the form of savings or fixed deposits.
2. NRO (Non-Resident Ordinary Account)
An NRO account is also an Indian rupee-denominated account and is available as a savings account and a fixed deposit. However, while an NRE account is used to keep money earned overseas, an NRO account is for managing the income you earn in India. This income can be through sources like rent (from a property you own in India), dividends, salaries, etc. You can repatriate up to USD 1 million in any financial year through an NRO account. You do need to note that this account's interest is taxable in India according to the Income Tax Act of India.
3. FCNR (Foreign Currency Non-Resident Account)
FCNR is a fixed deposit account opened by an NRI to transfer their foreign income in the same currency. Fundamentally, it differs from NRE and NRO in terms of the underlying currency denomination. NRIs can deposit funds in 7 currencies - US Dollars, UK Pound, Singapore Dollar, Hong Kong Dollar, Canadian Dollar, Australian Dollar and Swiss Franc. There are no restrictions on repatriation from an FCNR account. It is an investment option for NRIs looking to retain their income in foreign currency for better returns.
Few Suitable Investment Products for NRIs :-
MF Asset Allocator FOF Products
Under Mutual Fund Asset Allocator (Fund of Fund) the allocation to different investment style/asset class/market cap/sector is decided by the fund manager.
As the name suggests, these fund of funds, invest in other mutual funds. Unlike Equity FOFs, which invest only in other equity mutual funds, Asset Allocator FOFs will invest in a mix of Equity, Debt and Gold Mutual Funds, and the allocation range is generally highly flexible without any fixed range.
Asset Allocator Funds will invest into equity, debt and gold funds. So the underlying holdings are mutual funds instead of stocks.
MF Hybrid Products
Hybrid Funds are mutual fund schemes which invest in more than one asset class i.e. equity, debt and other asset classes depending on the investment objective of the scheme.
They invest across different assets, according to the fixed range, as specified in the investment objective of the scheme.
These funds invest in a mix of different asset classes to diversify the portfolio with an aim to minimise the risk involved. Depending on the allocation range of the different asset classes, based on the type of the Hybrid Fund, the Risk and Return of the Hybrid Fund varies.
GUARANTEED Life Insurance Products
ICICI Pru GIFT Plan (Guaranteed Plan)
Key Benefits :
Get 100% Guaranteed Benefits in the form of Lump Sum or Regular Income
Option to avail Income Benefits from 2nd year onwards
Get Income on a your desired special date with Save the Date feature
Enjoy Tax Benefits under Section 80C and 10(10D)
Secure your family financially with Life Cover
ICICI Pru Savings Suraksha (Endowment Plan)
Key Benefits :
Life cover to protect your loved ones
Guaranteed Maturity Benefit and Guaranteed Additions
Get Reversionary and Terminal Bonus, if any, over and above the maturity benefits of the policy
Enjoy Tax Benefits under Section 80C and 10(10D)
ICICI Pru Future Perfect (Endowment Plan)
Key Benefits :
Guaranteed Additions and Guaranteed Maturity Benefit by staying invested
Security of your loved ones with potential for wealth creation and Life Cover
Get Reversionary and Terminal Bonus, if any, on maturity of the plan
Enjoy Tax Benefits under Section 80C and 10(10D)
RETIREMENT Products
ICICI Pru GIFT Long Term (Guaranteed Income Plan)
Get 100% Guaranteed1 Income for a long-term period of upto 30 years
Option to get 110% of total premiums paid
Get Income on your desired special date with Save the Date feature
Enjoy Tax Benefits under Section 80C and 10(10D)
Secure your family financially with Life Cover throughout the policy term