# NRE, NRO & FCNR Account Advisory

> An NRE account holds money earned abroad — it's fully repatriable and its interest is tax-free in India while you're non-resident. An NRO account holds Indian income like rent, dividends or pension; interest is taxable with 30% TDS plus surcharge and cess, and repatriation is limited to USD 1 million a year. FCNR deposits hold foreign currency with no exchange risk. On becoming NRI you must convert resident accounts to NRO.

Practice: FEMA & RBI Compliance — https://www.industax.com/services/fema-rbi/

Mixing funds is the most common mistake: depositing Indian rent into an NRE account isn't allowed, and leaving resident savings accounts unconverted after moving abroad breaches FEMA. We review your accounts, fix designations and set up the right flow for each income stream.

When you return to India, NRE and NRO accounts must be redesignated as resident accounts or moved to an RFC (Resident Foreign Currency) account; FCNR deposits can run to maturity. NRE interest becomes taxable once you're no longer non-resident.

## Key facts

| Item | Detail |
| --- | --- |
| NRE | Foreign earnings; repatriable; interest tax-free while non-resident |
| NRO | Indian income; interest taxable; 30% TDS + surcharge + cess |
| NRO repatriation | Up to USD 1 million per financial year |
| FCNR(B) | Foreign-currency term deposit, 1–5 years |
| On return | Redesignate to resident or RFC account |

## Who needs this

- People moving abroad for work
- NRIs with Indian income and savings
- NRIs returning to India

## What's included

- Account structure review
- Redesignation guidance
- TDS and DTAA rate on NRO interest
- Returning-NRI account transition

## Documents

- Passport and visa / OCI
- Overseas address proof
- Existing bank account details

## Process

1. **Review** — Current accounts and income flows mapped.
2. **Restructure** — Accounts converted or opened as needed.
3. **Comply** — TDS, DTAA and ITR handled.

## Also covers

- **NRE/NRO advisory** — Opening, converting and closing NRI accounts.

## FAQs

### Can I deposit Indian rent into my NRE account?

No. Indian income must go to an NRO account; NRE accounts accept only foreign earnings and transfers from other NRE/FCNR accounts.

### Can NRO interest TDS be reduced?

Yes, by giving the bank a Tax Residency Certificate and Form 10F to apply the DTAA rate where lower.

### What happens to my NRE account when I return to India?

It must be redesignated as a resident account or its balance moved to an RFC account; interest after your return is taxable.

## Official sources

- RBI — Master Directions (Foreign Investment, Overseas Investment, LRS): https://www.rbi.org.in/Scripts/BS_ViewMasterDirections.aspx
- Income Tax e-Filing portal: https://www.incometax.gov.in/

---
Canonical page: https://www.industax.com/services/fema-rbi/nre-nro-advisory
Publisher: Indus Tax — CA-led tax and compliance firm (https://www.industax.com). Contact: info@industax.com, 9059139258.
This is general information, not advice for your specific facts.