Friday, May 20, 2016

10 Ways to Remit funds to NRE account in India

One of the frequently asked question from NRIs, who has just open an NRE (Non Resident External) account is how to fund their NRE accounts? Since you cannot transfer Indian rupees from your normal saving account in India to your NRE account, this question is common to arise. Simplest way to deposit money in your NRE account is remittance i.e. by sending money from your overseas bank account, but that's not the only way to transfer money to your NRE account. In this article, I am going to show you 10 ways to transfer funds to your NRE accounts. You can use any of these methods to deposit money in your NRE account based upon applicability and your convenience.  Each of the methods has their own advantage and disadvantage but in terms of convenience online money transfer to India is the best. You don't need to go anywhere, just send money from the comfort of your office and home.

Wednesday, May 18, 2016

Section 80TTA Tax Benefits - NRI can claim 10,000 INR On interest of Saving Account

Do you know that Non-resident Indians can claim a deduction on income from interest on saving bank accounts up to a maximum of 10,000 INR like resident Indians? Well, I didn't. I just come to know about this relatively new tax deduction method. This benefit is provided under Section 80TTA, which is available from the financial year 2012-13. Since an NRI can only have either NRE or NRO saving account, and given interest earned on NRE account is exempted from tax (see here), this will only applicable to interest earned on an NRO saving account. Note, this is different than interest earned on NRO term deposit, which is liable to TDS @ 30.9%. This deduction is only allowed on saving account balance e.g. you have 2 to 3 lakhs in your NRO saving account which resulted in an interest of around 12 to 15K INR on 4% annual rate. Btw, this deduction is applicable to any saving account deposit with a bank, co-operative society or post office.

Saturday, May 14, 2016

US NRIs and H1B holder must submit FATCA Compliance Certificates to Indian Banks

Recently one of my friend, working for an IT company in the USA on H1B visa received notification from Indian banks and Mutual funds that he needs to submit FATCA compliant certificates. He wasn't sure about what is FATCA and why he needs to submit FATCA certificate to Indian banks. This inspired me to write this short post explaining what is FATCA and who needs to submit FATCA certificates in India. Well, FATCA stands for Foreign Account Tax Compliance Act (FATCA), introduced by US tax authorities to crack down on tax evaders. Since, India and United States has signed a treaty to share information about US citizens and permanent residents i.e. NRIs working in the USA on H1B or L1 VISA and who own properties, bank accounts and other investments in US and India.