Who Can Open an NRO Bank Account ?

NRO Bank Account – Any person resident outside India (other than a person resident in Nepal and Bhutan). (individuals / entities of Bangladesh / Pakistan nationality / ownership as well as erstwhile OCBs require prior approval of RBI). NRIs/PIOs/OCIs can open an NRO account. Under prevailing FEMA regulations, you will be considered an NRI if:

• You are residing overseas (except Nepal or Bhutan) for more than 182 days in one Financial Year (April–March); or

• You have demonstrated an intent to go abroad or reside outside of India for an uncertain period:

  • Resident Indian professionals even before going abroad for employment
  • Students planning to study abroad

  • Seafarers who work on international ships

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NRO Bank Account Features

• Can be opened as a savings as well as a current bank account.
• Allows you to make fixed and recurring deposits.
• Maintained with two or more NRIs/PIOs or a resident Indian on a former or survivor basis.* The resident joint holder can only operate the account with a Power of Attorney (PoA)/mandate from the primary NRI account holder.

Document Requires for Opening a NRO Account

• Passport;
• Proof of Address: Driving license, Voter’s ID issued by the Election Commission of India, proof of possession of Aadhaar number, job card issued by NREGA, letter issued by the National Population Register, Passport;
• Non-Residential status proof such as Visa/Work Permit/Residence Permit for Indian Passport holder or OCI Card/document evidencing India connect for Overseas Passport holder;
• For seafarer’s account: Copy of passport and visa, contract letter, etc;
• Permanent Account Number (PAN) card or Form 60 for opening savings bank account (if income in India is less than 3 lakh in a financial year). Please note, a PAN card is mandatory to open a current account; 
• Foreign Account Tax Compliance Act (FATCA) declaration as applicable for the United States (US) or Common Reporting Standard (CRS) for the United Kingdom (UK), Canada or any of the 100+ countries that have adopted CRS.

Permissible credits in the NRO account

• Inward remittances
• Transfers from other NRO/NRE/FCNR (B) accounts
• Legitimate dues in India, such as sale/maturity proceeds of your investments in India, rental income, etc.
• Rupee gift/loan received (within limits prescribed under Liberalised Remittance Scheme) from a resident relative.

Permissible payments in India from the account

• Payments in India
• Outward remittances of current income without limit
• Transfer to other NRO accounts.

Repatriation of Funds

• Current income is freely repatriable without limit

• Capital income funds can be repatriated up to USD 1 million per Financial Year (April-March)
• The above repatriation is subject to necessary tax compliances and documentation

Income Tax implication on NRO Bank account

• TDS will be deducted at 30% plus applicable surcharge and cess on interest earned by a non-resident on NRO FD, RD and saving accounts .
• If India has a Double Taxation Avoidance Agreement (DTAA) with the country where he/she is a resident. then a lower rate of TDS will be applicable as per the respective DTAA will be deducted subject to the submission of required documents i.e. a Tax Residency Certificate (TRC), an online filled copy of Form 10F and a declaration stating that there is no Permanent Establishment (PE) in India. This is according to the provisions of the Income Tax Act, 1961 (IT Act)
• If your physical cash deposits/withdrawals in one or more accounts during the Financial Year (April-March) amount to ₹2 million or more, it is mandatory to hold a PAN card. 

Operation in the NRO account

Operations by Power of Attorney in favour of a resident by the non-resident account holder. 

• TDS will be deducted at 30% plus applicable surcharge and cess on interest earned by a non-resident on NRO FD, RD and saving accounts .
• If India has a Double Taxation Avoidance Agreement (DTAA) with the country where he/she is a resident. then a lower rate of TDS will be applicable as per the respective DTAA will be deducted subject to the submission of required documents i.e. a Tax Residency Certificate (TRC), an online filled copy of Form 10F and a declaration stating that there is no Permanent Establishment (PE) in India. This is according to the provisions of the Income Tax Act, 1961 (IT Act)
• If your physical cash deposits/withdrawals in one or more accounts during the Financial Year (April-March) amount to ₹2 million or more, it is mandatory to hold a PAN card. 

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