Funds Received In NRE Account May Be Taxable - A Must Watch For NRIs - CA Sriram V Rao
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- เผยแพร่เมื่อ 29 มิ.ย. 2024
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Only few such videos and knowledge is available on this topic throughout the internet. Thanks for sharing in detail.
You are running one of the Best channels on Finance advice. Thank you
Excellent content Dr Bhat. Really appreciate the research you have put up into your videos. I make it a point to watch your entire videos even when on Ship.
Thanks both of you for another brilliant work .
Each questions are great valuable.Thank you for both of you.k
Thank you so much for the information … I live in dubai and you have given exact situations and explained!!!
Excellent video...Thanks both of you 🙏
A brilliant video, you read the questions in our minds. Hats off
Appreciate your work...This is really ridiculous very complex tax rules...Finally last words giving relief...Pls don't take it as negative...
Both of you are so good and your explanations are very very clear
keep up the good work
Sriram is so knowledgeable
Excellent discussions.
Sir you have opened the eyes of many NRIs who are ignorant. I usually show your video to my colleagues who are indians.
Very nicely explained. All doubts are clear 👌👍
thank you very much for taking up sailors issue.
Great in depth analysis and interpretation of NR tax laws. Greatly appreciated. Thank you.
Thanks a lot..... Simply understand
Thanks. That's what I am looking for.
Thank you sir ...... it was valuable Hope your next ,,,,,,, advise
Dr.Bhat and Dr. Rao , Thank you very much for the in depth explanation around receipts into NRE Account.
Thanks for information sir। It's great ☺️
Thanks for the good information.
Great discussion Dr. Bhat. Keep up the good work
NRE FD interests are Tax Free for Indian tax purposes. But one might want to check their resident country's tax rules on world wide incomes
awesome clarity!
Glad to see you addressed this issue of seafarers.Now you are seafarer NRI money clinic.
We will do more videos for seafarers . Keep posting your specific queries of seafarers
Immence help eye opening 👍
Excellent video sir.
Thank you Sir, informativ vedio plz make som more vedios .
Hats off to you both for the effort to make this video . Very thanks for this informative video. All areas covered well regarding NRI taxation.It will be very helpful if you can disclose that special rule details and where we can find that circular regarding seafarer tax exception.
Just google for CBDT circular 13 of 2017 dt. 11.04.2017
What I understood and certain queries relating to the same are:
1. Remittance by self by debit to his/ her personal account maintained in the country of his / her residence I.e. person having residential cum employment visa in that country to which the employer credits his / her salary is treated as income earned abroad and remitted by self is not falling under the category income earned in India.
If my understanding is correct whether spouse of NRI staying with him / her having bank account abroad and remitting money from.that account is considered as income accrued ( not earned ) abroad and eligible for credit to NRE account and does not attract tax
Residential Visa status in the country of employment is the basic criteria.
2. Exemption is for sea fairies account since they do not have any residential visa issued not they live in India too . Kind of Trishanku status. Their income though remitted by their overseas employer is tax free income.
Doubt: if the employer is a India based shipping company whether qualifies for NRE Aaccount ?
3. In gulf most of the NRIs do not maintain bank accounts and salary or wages disbursed to them in local currency of the country where they reside/ witk. They remit through exchange houses which are not banks.
NRE accounts are opened by banks in India.
Grey area : funds are not remitted by debit to NRIs overseas account.
4. As there is no restrictions on the amount of remittance from abroad by debit to his / her account with a bank abroad if such account is funded by business income or third party there other than employer what cheque IT authorities can have if the remittances are disproportionate to ones income ? Possible that individuals overseas account could be misused through funding by many who may be friends or non Indians which may facilitate money laundering
Whether the concept of disproportionate wealth ( here balance in overseas account, ) to known income and remittance to NRE Accoubt is a possibility? The query is because bankers here may not be aware of NRIs monthly earning.
Thanks for the informative session. Is there any change in provisions since the video was released?
To explain better is that an employee must transfer from his personal account to India nre account, as this is treated as savings and then transfer to his nre account. Or else when an employer transfers directly to nre account of the employer then it is treated as receipt and hence taxed, is correct
All videos from your side are quite informative & useful to lots of NRIs & others. It’s a great service to all such tax payers.
Rao ji Could you please confirm if interest income on FCNR deposits of RNOR status is taxable in India? Many thanks in advance!🙏
Very good 👍
Thank you for the informative vedio. I have recently redeemed my Mutual Fund investments and depending upon the source of Purchase, they are credited to my NRO & NRE acconts respectively. TDS (@ 10.4%) is cut on all redumptions as I am NRI. Now my question is, do these redumption amounts need to be considered to caluclate my agregate income and will that get taxed as per the normal tax slabs in India ?
👍very good.
add english subtitles on all viedos , it will convient for foreigner to understand your talk
Very helpful ❤
very informative
Thanks for the informative video. May I request that if possible a video be published outlining shareholders' rights and options when companies fail to provide TDS Certificates on dividends paid? Thank you.
Just approach the company via e-mails and giving them details of your shareholding… they will provide you the same
Excellent information. Do you have something similar on MFs remittance received in your NRE account in India.
Please note that the an important information provided in the video is incorrect - refer to Pramod-Kumar-Sapra-Vs.-Income-Tax-Officer-ITAT-Delhi case where it clearly says that just because income is received in a bank account in India for a non resident it cannot be taxable unless the source is Indian or the DTAA requires so. The example given in the video does not meet the criteria under section 9 of the income tax act and therefore is not the right interpretation.
Hello… Hope you have watched the video fully… In the video, I have always pressed on the point that “MAY” & “MIGHT” when it comes to taxability of funds directly received in NRE. I am aware that there are several decision of ITAT and in some case even High Courts which held that under certain facts and circumstances it would not be taxable. I have specifically mentioned in the video also. Further, I would also like you to know that, this forum is suitable to talk technical. Otherwise, even I can talk section-wise, word by word and reading between the line, discussing about various case laws & nuances of them and interpretation of law etc.. but that would not give the desired result, which is to follow Principal of ‘PREVENTION IS BETTER THAN CURE’.
When it comes to receipts from Salary earned from exercising employment outside of India, the courts have time and again held in favour of NR assessee. However, it is litigious. The department would always want to tax and assessee has to litigate to get desired result/outcome. But if assessee has options, then why cannot he exercise/practice the same rather than getting into complexities. This is the main intention of the video.
Yes, we have watched full. But there is already a verdict from ITAT.In recent judgement ITAT has held that only because the overseas employer paid salary into NRE account of the assessee in India, it would not imply that the income is taxable in India.. ABCAUS 3773 (2023) (06) ITAT.
All viewers and subscribers of your channel expect a clarification / correction from you with reference to the foregoing verdict from ITAT.. Surprised Why not you accepting or discussing the verdict of ITAT. Why u stick with ur argument may / mught? We don't expect this from a CA professional.
Agree
and how about money made from doing business outside in a foreign country while being an NRI and then gets it remitted to the NRE account by the business owner? like a seafarer
Very informative, in depth analysis/explanation. My question: My daughter is having NRE account in India. Can she invest in co operative Society FD through NRE account (Transfer money from NRE to co operative Society FD)
Very informative video. But have one more scenario is money received in NRE account can be transferred to other payments with in India (e.g home loan repayment etc) or it should be transferred only via NRE>NRO>home loan repayment likewise?
Very misleading. NRI salary earned abroad and directly credited into NRE acc is no more taxable. But the expert mentions it as a thumb rule that direct credits are taxed by default. I like the host who has more clarity then the guest.
Sir this is very informative video.
Thanks for all your efforts taken for making this video.
Sir can you please make a video on income tax guide for seafarers.
you could have covered transactions from NRE to NRO account.
Investing in India is full of catches. You will only end up losing your mind, having headaches and end up losing your money.
Also there is the factor of devaluation of Indian Currency. 11:07
Question: Employer remits directly to NRE account, employee works in a location where he cannot open a local account being a high risk country or non availability of international banks at the work location? How would this be treated?
Hello! Very informative video :)
Had a query -
If I'm an NRI, living in country A on a dependent visa (because my husband is employed in this country) ; and I am working as a freelancer for a company in country B - who pays me directly in my NRE account in India (whenever I raise an invoice); Would I be taxed in India?
Any help would be appreciated.
Thanks in Adv.
Which section or rule or provision of IT ACT covers that money received in NRE account is not taxable in India?
suppose salary comes into foreign account..then transferred to NRE..it is tax free. Now if entire amount is sent to NRO account, will it be under taxation? or it has no implications?
Sir, if money has to be transferred from a father's resident accout to a NRI daughter as inheritance under Will, is it better to transfer to the daughter's NRO account, NRE account or directly to her foreign bank account?
The direct debit to NRE account from outside india might attract tax because the govt thinks this is a way to avoid local taxation in your country of residence. Hence the gov of India wants subject that money to tax to prevent money laundering
Let's say and NRI dies and wants to leave all his Indian NRE account to a good charity in India. How does he do it. What are lists of charities in India you can trust . Would prefer the money go towards children education at poverty level, or support schools who are unfunded for children .
How does one leave a good legacy behind like this, and money not be missing due to corruption.
An nri sells his property in India, say for Rs. one crore, can it be deposited to nro account without tds. Of course tax will be given on the interest earned later on as per FEMA rules. Please answer.
I have an Yes bank NRE account and one of my friend send me as a Gift to me in my NRE account as it was first time, I have received a forgein inward remittance message from bank but my relationship manager write me to revert that mail by saying it's my Salary. But it was not, it was a gift by my foreign friend. Now I am feeling I can be subject to scrutiny or they won't look at it as it was just 3 times in total and approx. 2000 euro. Should I be worry or tell the relationship manager about it? can it be done anything now? Thank you
If one of my friend planning for vacation to the country im staying, lets say thailand and instead of carrying local currency he can send money to my NRE account? In this case will it be taxable?
Great information. My Question: RBI Master Direction no.14/15-16 dated 1/1/2016 updated on 9/1/2020, Part II, Para 4.7 states “Current income like rent, dividend, pension, interest etc., will be construed as permissible creditto
Sorry please continue: credit to NRE Account. Kindly give your opinion. Thanks
It's so rediculas to tax the salary directly deposited by your employer to your NRE account.. India has the worst income tax laws
What would be tax exemption limit on a joint NRO account? Is it still 2.5 lakhs?
For example if i have a joint nro account for me and my wife (both are NRIs) is the tax exemption limit 2.5 lakhs or 5 lakhs for this particular account?
Great coverage in this session by you both CA Sriram and Dr. Bhat.
I’ve NRE/NRO A/c in some banks in India. I transfer money in the A/c of my spouse to run the family and pay the expenses of schooling of kids. As I understood, it should be declared as gift. But, what’s the process to declare the gift?
Also, should my spouse file the ITR even though, she doesn’t have any income apart from the money I transfer?
I hope you’ll help me by addressing my query.
Thanks
It is self explanatory as GIFT… she need not file return of income, if this is the only receipt/income for her…
why? Transfer to your own account and give her the ATM card. This is what most people do.
Transfer to your joint account NRE /NRO instead of transferring to resident savings account . Debit card / checks / online banking will take care of expenses. This way you have transparency. Transfer from your joint account to joint account NRE is the way to go
@@sundarv1485 interest earned in NRO has a TDS of 30%. So NRE is the only option
When a married man only earns? Then he is earning for the family so all money belongs to all members of the family? How can that be a gift?
Hello sir, as you said that seafarer are exempted even if they receive salary directly in nre account in India. But how will tax department identify that a person is seafarer,unless they send notice to him first explaining the source of income and profession. Or they already know before in hand that a fellow is a seafarer and they don’t scrutinise further by sending notice to him
Hi Sriram.. very knowledgeable video and helped me to understand the tax rules. My Question, is that allowed to have normal savings bank account in different bank than NRE account bank?...also we can transfer from NRE account to same person savings account or different persons savings account also, is that my understanding correct?
No, one being NR, can have only NRE/NRO/FCNR accounts… cannot having ordinary resident SB/FD/RD/TD accounts even in other Indian banks… it’s gross violation of FEMA… there are videos in this channel on Violation of FEMA on this channel with CA Dhanush… watch that and be guided
One of my clients is having business outside India and getting income in the name of Management Fees. He is doing some business in India too. He needs some funds for Indian business. If he infuse capital out of such foreign income, will it be taxable.
Sir which is the best bank for seafarers? Thank you
thanks for this useful video. Can I send one hundred thousand dollars to my NRE account and whether it is taxable by the bank as TDS please give me the answer.
When an NRI becomes resident, his resident bank account will be charged 30% TDS whenever foreign incoming transfer happens, so make sure all transfers are done before you become resident
My friends working for a european company in Africa. Their salary remits from company account outside India to my Indian NRE accou 18:41 nt at the end of each month. (Not from an Indian company and not for the service/ employment in India). How is it taxable?
Please advise about salary received by seafarers aa salary directly into nre account. Is it taxable?
Usually salary is paid after tax deduction in foreign country. it is tax paid salary. So what is wrong then transferring the money whether it is the employer or NRI employee transferring ? If it is taxed in India also, It will be double taxation.
what are the charges for withdraw fund received from NRI account to RI account
Thanks for the video and cleared some of the doubts. However, as mention, if the income coming to customer NRE account directly from the employer account will incur tax lability in India. Appreciate if you advice Which section of the IT act , this is applicable. As remedial action as per the video, The Double Tax Avoidance Agreement as some countries have this agreement with India , not all. Thanks
It is taxable as per scope of income… section 5, subsection 2 clause (a)…. Yes, India has DTAA with about 90+ countries
What about the money received from sale of lands in India kindly make clear
Dr Bhat and Dr Rao,
I maintain separate NRO & NRE accounts from my wife who in turn has both NRE/NRO accounts. We are not making remittances to our NRE accounts as we are well settled in Australia and have no intention to settle back in India. But from time to time we need to debit/credit our NRE accounts to keep the accounts from going dormant. So once in a while we transfer say Rs 100/- between our NRE accounts. In that case would the credit be considered income and become taxable? Thanks in advance.
These are all self explanatory transactions between your own bank accounts or of your wife’s… will not be in the nature of inocme
Please if you can answer…if money received in NRE account is from the same person who is an NRI…like from my USA bank I am sending money to my NRE account…is it still taxable?
Dear sir
Can we move Indian income from NRO account and park it in NRE fixed deposits using Form 15Ca.
This way we can save tax on interest
Thank you Dr Bhatt and Dr. Rao for nice explanation in most simple manner . I have a question sir. If an NRI transfer money to Indian NRE account from his own foreign country bank account and then from transfer NRE to NRO bank account to invest through NRI demat account, what would be his tax liability if has no taxable indian income other than Capital gain through NRI demat/trading account?
After I retired for over 7 years, income tax is asking me proof that I remitted money from proper source from abroad. How can I provide proof of money remitted over 7 years ago? If the remittance was illegal, the bank where I held my NRE account should be aware of this ... as such the idiots in the income tax should question the bank ... perhaps the income tax people were fishing for bribes from me.
Is there any tax implications when we externalize funds from NRE & FCNR accounts ?
Sir,
Being low charges I transfer amount in my NRE account via western union (I pay to western union from my bank account in UK & western union transfers it in my NRE account in India. I guess this transaction is not my income in India, right?
Do we need to pay taxes in the country we are residing in for the interest earned in nre fixed deposit? Note: I am not asking about paying tax in india but in the country person moved to.
Very informative discussion, thanks for explaining the queries with such details.
Request you to please clarify if by 'Third Party Remittances' you mean remittances using apps like Remitly that moves the funds from the overseas bank account to Indian NRE account? Are such transfers liable for tax?
The question to be asked is, are you transferring funds from your own account through the apps? - if yes, then it is not third party transfer
@@sriramrao2514 so what would be considered a third-party remittance?
Very informative
I have a doubt
you can transfer funds from an NRO account to an NRE or Non-Resident External account. The Reserve Bank of India allows the transfer of funds up to USD 1 million a year from an NRO to an NRE account.
In future the income from this transferred money (in NRE account )is taxable ?
Till when you remain NR, interest from NRE will be exempt
Sir I have one question ,I work uae and l want took loan and invest india share market so how much money can I transfer in my demat account through my nra account
Very informative video. Great job sir.
I have a query regarding my NRE account. As you had mentioned in one of your earlier videos that money deposit/transfer to NRE Account can be done only from outside India and some need some special cases can be done within India itself. I am now paying a month SIP for a ULIP Account which will expire in few years. Since that money will be deducted from y NRE account can that amount after maturity be transferred back to my NRE account?
There are certain rules for this… the ULIP should have been opened as a NRI on a repatriable basis… then it is possible.. but there are lot of restrictions for the same…
Thank you for the advice. I don't remember if I had opted that option, will check
Thank you for the explanation. What happens to the interest income from the NRE Account if we return to India and file the Income-tax return as Resident. Will the interest income be exempt or do we have to pay tax on that?
Watch video on ‘When should NRI’s close NRO-NRE bank a/c’ in this channel
Sir thank you very much for this video. Actually I invested in MF as SIP through NRE Account and before one year period I redeemed MF but till Now money not credited to my NRE account please what is the procedure tu get my money back my money stuck somewhere I don’t know where. MF companies send emails that your redemption money is rejected. Please advise me to get out with this. Thank you
Can i do kyc online to start investing in MF & shares having NRE account
Sir, can we directly send money from uae salary account to nre account, without any commission?
Great Information. Thank you a lot. I am an NRI since long but was not aware of rule of transfer directly by third party. Will take some measures on some such payment our company makes.
Sir, Actually I was looking for answer for whether is there any threshold / limit on remittance amount above which Tax department raises query or any return / reporting an NRI has to file?
Would be thankful if you can clarify on this.
Please do an episode on using Transferwise (now called Wise) to mit to India and out of India
Yes I to want to know the answer to the above question please.
Indian citizen getting pension
After becoming american citizen will he receive pension .? Yes or no .
Please reply
Thanks for the informative video. But sorry to say it has not given solution which, probably, I have asked you.
Funds received in NRE, from children, transferred to parents as gifts. What tax treatment to parents will it receive? Request you to address this issue. Shall remain grateful to you for your favour.
Watch the video completely . Gifts to parents are tax free. This is mentioned. Also watch a video on taxation of gifts available on this channel
What if someone take loan from Other contry bank in his local bank account then he transfer money in his NRE ACCOUNT in Indian account so is it non taxable right ?
U both great personalities have been doing great informative service to NRI. My question is ... If I being an NRI bring cash € in India and go to any indian bank to open NRE or FCNR or NRO a/c. Is this legal and do I need to declare at the entering airport in Indian or what else. . ..
Pls guide ahead u both superemos for NRI's
Depositing cash from India to NRE/FCNR is not permitted… cash deposit to NRO is permitted… however the source of it has to be proved on enquiry and if taxable then tax also need to be discharged at appropriate applicable rates
As far as I am aware, carrying of cash across counties beyond specifically allowed limit is not permitted… I am not aware of these limits though,
@@sriramrao2514 Sir, once when I was traveling to India I got a form in plane to fill up, which inuded one part immigration n the second part abt cash bringing in. Sofar I can remember cash amount exceeding 5000$ sholud be declared while entering India.
If you know abt this rule, I'd this still in action?
In recent judgement ITAT has held that only because the overseas employer paid salary into NRE account of the assessee in India, it would not imply that the income is taxable in India.. ABCAUS 3773 (2023) (06) ITAT.
All viewers and subscribers of your channel expext a clarification / correction from you with reference to the foregoing verdict from ITAT.
If the income is already taxed in the country where NRI is living and after due deductions of tax in that country the employer directly credits in the NRE account. Then will it be taxed. Will it not result in double taxation
Sir;
Request following clarifications:
1. If foreign employer is remitting the foreign income in your NRE account after deducting the tax as per his country rules, then the income should be tax exempted.
2. If we invest in shares and MFs through NRE account, then how the proceeds received from redemption of such investments in NRE account (Principal and Profit) will be treated. Thanks.
Ans 1. No, it doesn’t work like that all times… watch the video fully to know what is the available remedy.
Ans 2. Such incomes are always taxable in India, as the source earning capital gains is in India…
Nice discussion, as always.
I have 2 situations where NRE Income arises:
1. NRE FD/RD interest
2. Maturity/Annuity of insurance policies whose premiums were entirely paid from NRE account
Would be thankful.
Thank you so much for such simple way.
NRE FD interests are Tax Free for Indian tax purposes. But you might want to check your resident country's tax rules on world wide incomes.