Financial Checklists for an NRI to Be on Right Side of Law

If you have got your plum job abroad and are about to get to your dream destination, pl undertake following measures as your status will change to a non-resident Indian and this will impact how you bank, invest or pay tax.

Must Do Actions Before you Leave India to be on Right Side of Law.

NRI Banking in India 

You cannot hold a regular savings bank account in India as an NRI and An NRI is required to have a non-resident external ( NRE) account. Credits to this account can be through remittances from overseas or foreign currency deposits.  The NRI's existing accounts will be converted to non-resident ordinary (NRO) accounts, wherein he can deposit his earnings in India, such as rental income, pension, etc." You can request the bank to retain the same account number.

As an NRI, you can continue to service a home loan. However, you may need to give fresh post-dated cheques or if the EMI goes through ECS, you will have to route it through your NRO account. Also, register for receiving e-alerts and loan account statements through Net banking. This will allow you to know the principal and the interest portion paid when you file your tax returns abroad.

Make use of additional facilities like HSBC offers Premier Assist to its NRI customers, which includes property rental assistance, airport lounge access and emergency hospitalisation. However, the minimum account balance in such cases Rs 25 lakh on a quarterly basisYou will need to close other bank accounts as these will become inactive if you don't use them for a year, and dormant after 6-12 months of being inactive. "Many people don't close the accounts through which their insurance premium and EMIs are paid. However, this isn't allowed and they may have to pay a fine," says Sandeep Shanbhag, director at investment advisory, Wonderland Consultants. 

NRI Investment or Trading in India 

• If you want to continue to trade in India, you will need to open a PINS account with the depository participant (DP). However, you will not be eligible to invest in all instruments, such as the Public Provident Fund, small savings or certain shares (which are listed by the RBI).
• "When you change the status to NRI with the DP (share broker), you need to distinguish between shares that can be repatriated and those that cannot. For this, you will need permission from the depository (NDSL/CDSL) and separate accounts. The non-repatriable securities will be linked to the NRO bank account and you'll be able to withdraw up to $1 million (Rs 4.92 crore) from it.
• If you are not going to use your demat account while abroad, you can freeze it. While it will continue to receive credits, such as bonus shares and dividends, the transactions will be blocked till you give written permission. If you do not want to freeze the entire account, you can do so for a select number of stocks.

 NRI Investment in India in Mutual Funds

In the case of mutual fund investments, you will have to fill up a know your customer (KYC) form, mentioning the change in your residency status as well as the bank account number, so that the SIP debits take place from your NRO account. "If you do not inform the mutual fund house about this, you may suffer a loss as SIPs for NRIs cannot be debited from resident savings bank accounts,

Conclusion

Thus to put the things in the correct perspective that necessary actions are taken by you in the financial institutions, banking, demat accounts, online trading accounts and mutual funds to avoid troubling your parents at a later stage and asking them to do documentation on your behalf which you could have had done easily had you taken pains to read this article before going abroad.

Keep visiting our website for best trading tips for NRIs and quadruple your capital at a fast pace by virtue of accurate and relaible tips suiting your financial style of trading.

Keep India Shining and keep sending dollars home as you are contributing to the growth of the nation by virtue of foreign remittances. !