1. What is the Restict List/Watch List? 2. Can a NRI square up trades or funds in the same settlement? 3. How do I remit money to India? 4. Is a NRI required to file a Return of Income every year? 5. Can a NRI deposit hard currency in NRE or FCNR account, while in India? 6. What are the regulations regarding Portfolio Investments by NRIs/PIOs? 7. Can income earned on Portfolio Investment scheme be remitted abroad? 8. For the purposes of investment in mutual funds, is it required by a Non-Resident Indian to seek permission from the RBI? 9. Are the NRIs permitted to give a Power of Attorney to a resident Indian to operate the Non-Resident accounts? 10. Does an NRI require PIS permission to purchase shares in Primary market (IPOs) on reptriable basis? 11. Can NRI's invest in companies in India? 12. Is it Necessary for NRIs to have a PAN Card Number? 13. Is NRI required to file taxes? 14. Can Nri's save in Small Savings Schemes (PPF, KVP etc)?
A. There is a ceiling on aggregate investment by NRIs/OCBs. When the NRI/OCB holding in any scrip is about to breach the maximum prescribed limit, RBI puts the concerned scrip on the Restrict list/ Watch list. This list is published by the RBI as and when there is any movement into/out of the list. NRIs/OCBs are required to check the list before making any transactions in the scrip. In case, the NRI holding crosses the maximum prescribed limit for any scrip, then the NRI shall immediately have to square off the excess holdings. Any profit on sqauring of this transaction shall not be credited to the NRI. However, loss if any, shall have to be borne by the NRI.
A. A NRI can only do delivery-based transactions. He cannot do day trading or square up transactions in the same settlement. Also, he shall have to make bill to bill settlements. He shall not be allowed to adjust any purchase transaction against any sale consideration of the previous settlement.
A. The approved method of sending remittances is through normal banking channels. These are converted by the banks at the market rate of exchange. Money can be sent through cheques, demand drafts or through telegraphic and wire transfer. Wire transfer is the most preferred mode of remittance as it is cost effective, swift and eliminates the risk of any transit loss, possibility of which exists in the case of DD, etc. Most banks also provide for other methods of sending money to India either through net transfer or card transfer.
A. Where a NRI has total taxable income below the exemption limit, he is not required to file a return of Income Tax. Also, where the total assessable income consists of only Investment Income or LTCG and TDS has been deducted from such income, then the NRI is not required to file any Income Tax return.
A. When in India, a NRI can deposit upto $5,000 per day in hard currency in the bank account. In case of Travellers Cheque, the limit is $10,000. However, in case the NRI has declared the cash at the customs, then he can deposit upto the extent of the amount declared in the customs.
A. Non Resident Indian (NRIs) and Persons of Indian Origin (PIOs) can purchase/sell shares/convertible debentures of Indian companies on Stock Exchanges under Portfolio Investment Scheme. For this purpose, the NRI/PIO has to apply to a designated branch of a Bank, which deals in Portfolio Investment. All sale/purchase transaction is to be routed through the designated branch. An NRI or a PIO can purchase shares up to 5% of the paid up capital of an Indian company. All NRIs/PIOs taken together cannot purchase more than 10% of the paid up value of the company. The aggregate ceiling of 10% can be raised to 24%, if shareholders of the Indian company pass a special resolution to that effect. The sale proceeds of the repatriable investments can be credited to the NRE/NRO accounts of the NRI/PIO whereas the sale proceeds of non-repatriable investment can be credited only to NRO accounts. The sale of shares will be subject to payment of applicable taxes.
A. Income such as interest and dividend earned by NRI from portfolio investments acquired whether on repatriation basis or on Non- repatriation basis, can be remitted abroad provided applicable taxes have been deducted or paid. However capital gains can be repatriated only if investment is on repatriable basis.
A. NRI's need not seek permission from the RBI to invest and redeem units in Mutual Funds.
A. A Power of Attorney is given only for operations in the account and not for opening the account. Further the operations are restricted only for making legitimate local payments. In no circumstance is the Power of Attorney holder allowed to repatriate the funds abroad or make payments of gifts on behalf of the account holder.
A. No, NRIs can purchase shares in primary market on repatriable basis and application money can be paid through regular NRE Savings Bank account or through inward remittance.
A. NRIs are permitted to make direct investments in proprietary/partnership concerns in India as also in shares/debentures of Indian companies. They are also permitted to make portfolio investments i.e. purchase of shares/debentures of Indian companies through stock exchanges in India. These facilities are granted both on repatriation and non-repatriation basis.
A. It is now compulsory for all Indians to have a PAN number as per the IT department of India. Everyone wanting to invest in India now, must have a PAN number as well. As per the Indian Tax Department, it is now necessary to have a PAN number in order to file your taxes in India. You need it when filing for you tax returns, most kinds of investments, and other financial transactions. When investing, a PAN card is needed when you open a Demat Account, invest into stocks, purchase or sell shares, purchase or sell mutual funds, or investing in other assets in the market. Other reasons you need a PAN is to buy real estate, to open a bank account, to get a loan, getting a passport, getting a visa, and to receive money from abroad.
A. NRI Income in India: All NRIs that have income earned in India will be taxed and should file tax returns annually. For an NRI, it is not required to file tax returns on investment gains if the tax was taken out for it at the beginning.
A. No, NRI's cannot invest in Small Savings schemes.