PPT6111111111111111111111111111 NRI.pptx

Nri

1. Non Resident Indian

2. Learning Objectives Who is an NRI/PIO Types of NRI Accounts NRO NRE FCNR Foreign Currency a/c of Residents

3. Who is an NRI NRI – Non Resident Indian An NRI is an Indian citizen who stays outside India: For employment or business; or Intends staying outside India for an uncertain period; or Is an official deputed abroad by Government/ Public Sector Undertakings on temporary assignments

4. NRI as per IT Act Section 6, IT Act 1961 defines NRI as : A person who has not resided in India for a specified period. A residence in India requires stay in India of atleast 182 days in a calendar year or 365 days spread out over 4 consecutive year. Any person who does not meet this criteria is a non resident.

5. PIO – Person of Indian Origin A foreign citizen is deemed to be of Indian origin if : He/she , at any time held an Indian passport He/she or either of his/her parents or any of his/her grandparents was a citizen of India He/she is a spouse of a PIO / Indian citizen * Citizens of Bangladesh and Pakistan do not qualify as PIOs even if they satisfy the above conditions Citizens of Nepal & Bhutan are treated on par with Indian Resident, can have local rupee accounts.

6. OCI-Overseas Citizen of India Citizenship of India (OCI) commonly known as ‘Dual Citizenship’. Persons registered as OCI have not been given any voting rights . Registered OCIs shall be entitled to following benefits: Multiple entry, multi-purpose life long visa to visit India; Exemption from reporting to Police authorities for any length of stay in India; Parity with NRIs in financial, economic and educational fields except in the acquisition of agricultural or plantation properties. A person registered as OCI is eligible to apply for grant of Indian citizenship under section 5(1)(g) of the Citizenship Act, 1955 if he/she is registered as OCI for five years and has been residing in India for one year out of the five years before making the application.

7. Who can open NRI accounts? Crew of Indian nationality aboard ships. Govt. employees with diplomat passports. NRIs, PIOs Indian students studying abroad.

8. These individuals CANNOT open NRI accounts Foreign Nationals coming to India on a work/business visa. Indians abroad for medical treatment. Indians abroad on short business trips. Indians going abroad for leisure. Indians in Nepal,Bhutan,Bangladesh & Pakistan.

9. Types of Products . Bank Accounts Rupee Account Foreign Currency Account NRE NRO FCNR RFC For depositing income earned income in India For depositing income earned outside India EEFC

10. Features of NRE Account NRE- Non Resident External Account Rupee Account for depositing income earned overseas. Can be opened as CA, SB,FD & RD. Local credits are not allowed. Funded by foreign currency cheque/transfer from other NRE/FCNR account/remittance from outside India Exempt from TDS in India. Funds held in the account freely repatriable . Joint holding only with NRI’s. SB interest rate as per Bank applicable. Amount can be transferred to other accounts, once transferred cannot be credited back. International Debit card given.

11. Features of NRE FD Rupee deposit for income earned from overseas. Taxation , Repatriation, Joint holding & Funding features are same as NRE SB features Loans can be given against an NRE FD Interest rate is the same as Resident FD Deposit Confirmation Advice (DCA) on deposit opening Interest is not paid if the deposit is prematurely withdrawn before completion of 1 year

12. Features of NRO Account NRO-Non Resident Ordinary Account Rupee Account for depositing income earned in India Can be opened as CA, SB, FD & RD. Local credits are allowed like rent, interest, profits etc. TDS @ 30.0 % Limited repatriability upto USD 1 mio p.a (subject to conditions) Joint holding can be with residents Funded by cash (rupees)/Transfer from resident a/c or cheque in addition to NRE funding methods Foreign citizens on short visit to India can open Special NRO A/c for less than 6 months. Local debit card provided.

13. LIBOR-London Inter Bank Offered Rate An interest rate at which banks can borrow funds, in marketable size, from other banks in the London interbank market . It is the primary bench mark rate. The LIBOR is fixed on a daily basis by the British Bankers' Association . The LIBOR is derived from a filtered average of the world's most creditworthy banks' interbank deposit rates for larger loans with maturities between overnight and one full year. LIBOR has reached such stature that the rate is published daily by the BBA at about 11:30 a.m. GMT by Thomson Reuters. LIBOR is set by 18 international member banks. LIBOR is important because it is the rate at which the world's most preferred borrowers are able to borrow money.

14. Features of FCNR Account FCRN-Foreign Currency Non Resident Account Foreign currency deposit for income earned overseas. Taxation , Repatriation, Joint holding & Funding. Features are same as NRE SB features Loans can be given against an FCNR FD (max 100 lakhs). Min tenure: 1 year Max tenure: 5 years Interest is not paid if the deposit is prematurely withdrawn before completion of 1 year. Rate of Interest LIBOR + 100 bps (fixed by RBI from time to time)

15. KMBL Interest Rate 1- 2 years. NRE/NRO SB 4% pa NRO TD 9.00% NRE TD 9.10% FCNR (USD) 2.69% FCNR (GBP) 2.88% FCNR (EUR) 2.39%

16. FCNR(B) Interest Rate FCNR (B) Interest rates for the period from date 01st June 2013 to 30th June 2013 Maturity USD GBP EURO YEN CAD AUD CHF One year and above but less than two years 2.69% 2.88% 2.39% 2.44% 3.79% 5.34% 2.25% Two years and above but less than three years 2.45% 2.68% 2.43% 2.29% 3.43% 4.74% 2.15% Three years and above but less than four years 3.64% 3.78% 3.57% 3.36% 4.55% 5.93% 3.24% Four years and above but less than five years 3.90% 3.96% 3.74% 3.43% 4.70% 6.16% 3.37% Five years only 4.16% 4.15% 3.93% 3.54% 4.85% 6.32% 3.52%

17. Features of RFC Accounts RFC-Resident Foreign Currency A/c Can be opened in SB and FD. Available to NRI’s to hold FCNR/NRE a/c after they have returned to India. RFC can be opened only after transfer from FCNR/NRE who were minimum for 1 year . Rules for RFC FD is same as FCNR FD. Balance in RFC is freely repatriable . If holders become NRI, the accounts can be converted to NRE/FCNR. Rate of interest is decided by Banks, no interest payable on Current accounts

18. Exchange Earners Foreign Currency Account Provided for exporters & other consultants who earn in foreign currency . Amount is held in foreign currency to meet payment obligations. Earners can retain 100% of remittance received in this account. Maintained in current account. Can be opened as FD or SB but no interest will be provided. Once converted into INR the amount cannot be recredited into EEFC a/c. Incase exporter has a foreign currency account abroad, he cannot open an EEFC a/c.

19. Resident Foreign Currency (Domestic ) Account Can be opened by Resident Indian in foreign currency provided the currency has been acquired: While on a visit abroad, payment for services not done in India. From a person who is not resident of India, on a visit to India as a honorarium/gift for services rendered. By way of gift / honorarium while on visit abroad. Gifts received from close relatives and repatriated to India through Banking channels. Out of earnings through export of goods/services, royalty, honorarium. No interest payable on these accounts as they are current account.

20. What is DTAA DTAA or Double Taxation Avoidance Agreement is a tax treaty that India has with 88 other countries . In plain language, what this means for an NRI is, if he/she is a resident in any of those 74 countries and is paying taxes on the income earned in that country, then he/she is eligible for a lower deduction of tax on income earned in India in that financial year. Eg:If you are a US resident paying taxes in the US and qualifying as an NRI/PIO as per the FEMA definition, then you can submit the requested documents by your bank/AD and avail a lower withholding of tax. You will be taxed @ 15% for the interest income earned on your NRO account/deposits rather than the standard 30 %. In case you have not claimed for this benefit with the bank, you are eligible to seek a refund from the revenue authorities under this treaty. One important aspect for claiming DTAA, is that the Permanent Account Number (PAN) has been made mandatory to avail the benefit of lower withholding under DTAA. Also important to note, there is an expiry date on the documentation and the same needs to be refreshed every financial year with the bank/AD to ensure validity.

21. Some of countries with TDS details are as below : Country Rate of TDS on interest for Max Yield NRO Deposit (with DTAA benefit) Rate of TDS on interest for Regular NRO Deposit(without DTAA benefit) US 15% 30% plus surcharge and cess UK 15% 30% plus surcharge and cess Singapore 15% 30% plus surcharge and cess South Africa 15% 30% plus surcharge and cess Belgium 15% 30% plus surcharge and cess Kenya 15% 30% plus surcharge and cess Saudi Arabia 10% 30% plus surcharge and cess UAE 12.5% 30% plus surcharge and cess Australia 15% 30% plus surcharge and cess Canada 15% 30% plus surcharge and cess

22. Correspondent Bank Details KMBL Currency Correspondent Bank Name Correspondent Bank Swift Code Correspondent Bank Clearing Code Nostro Account Number USD (US Dollars) The Bank of New York Mellon, No 1, Wall Street New York, N.Y.10015 IRVTUS3NXXX FED ABA 021000018 CHIPS UID 402260 8900517794 EUR (Euro) Standard Chartered Bank, Frankfurt, Germany SCBLDEFXXXX IBAN DE68512305000500006901 BLZ No. 51230500 500006901 JPY (Japanese Yen) Sumitomo Mitsui Banking Corporation Tokyo 100-0005, Japan SMBCJPJTXXX -- 4904 GBP (UK Pounds) Standard Chartered Bank 37 Gracechurch Street London EC3V 0BX UK SCBLGB2LXXX IBAN GB08 SCBL 6091 0412 5077 65 Sort Code - 60-91-04 00 01 2507765 01 AED (UAE Dirhams) Standard Chartered Bank, DIFC Building 1 3rd Floor, PO Box 999, Dubai, UAE SCBLAEADXXX IBAN AE330440000015422458201 15-4224582-01

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