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Bank of India And TimesofMoney Join Hands To Provide Online Money Transfer Service NRIs In UK
MUMBAI: Bank of India, India's premier public sector bank, has signed a service agreement with TimesofMoney to offer remittance solutions to NRIs in UK. This strategic partnership will enable NRIs send remittances in Great Britain Pounds (GBP), seamlessly and securely.
This online remittance service will offer all users competitive pricing, both in terms of exchange rates and transaction costs. Moreover, the customer is assured of convenience as he has no longer, to visit a branch and can execute the online money transfers from the comfort of his home/office.
Speaking on occasion, Shri Alok K. Misra, Chairman and Managing Director, Bank of India said that ''NRIs are a strong focus for our bank, and our global reach makes us uniquely positioned to serve
them. We are happy to offer a technology driven service to U.K. based NRIs. The main concern for all NRIs is to have a fast, secure and cost effective way to send money to India. The product will ensure that the users can now transfer money 24x7 in an affordable and secure manner''.
Commenting on the occasion, Avijit Nanda, President - TimesofMoney said "India is the highest remittance receiving country in the world, estimated at over US$ 58 billion. TimesofMoney's proprietary platform, 'Remittance in a Box' provides banks with a unique plug-and-play solution to power their online remittance service. This platform offers user interface & design, risk management, technology, operations and customer service. This alliance with Bank of India gives us a great sense of pride and we look forward to growing this relationship."
Bank of India has an overseas presence of over 65 years. It has offices in 19 foreign centres spread over 5 continents, where its services are extended through 49 outlets, including 7 in UK. Almost 25% of the Bank's business is contributed by its foreign offices. TimesofMoney is India's leading digital payment service provider and serves a varied client base. Spanning Indian and international clients, its offerings include specializedNRI services, Money Transfers, and e-Payments.
The government has so far issued Aadhaar cards to over 92 crore citizens

External Affairs Minister Sushma Swaraj delivering a speech at Pravasi Bharatiya Divas as Britain's minister for employment Priti Patel looks on in New Delhi

The government is considering giving Aadhaar cards to Non-Resident Indians (NRIs) and a decision on it will be taken soon, External Affairs Minister Sushma Swaraj said today while inviting the diaspora community to actively participate in India's growth story.

In her address to the first limited edition of Pravasi Bhartiya Divas (PBD), Swaraj said it has been decided that women workers will be allowed to go to Gulf countries for employment only through government agencies to ensure they are not duped by recruiting agents or firms.

The PBD, webcast by almost all Indian Missions and Posts, was organised for the first time by External Affairs Ministry (MEA) after the government's decision to merge Ministry of Overseas Indian Affairs (MOIA) with it.

Earlier MOIA used to host the event. January 9 was chosen as the day for PBD as it was on this day in 1915 that Mahatma Gandhi, the "greatest Pravasi", returned home from South Africa to lead India's freedom struggle.

Asking the diaspora to participate in government's various flagship programmes including Skill India, Digital India and Clean Ganga initiatives, she said Prime Minister Narendra Modi wants the Aadhaar card scheme to be extended to NRIs.

"So far Aadhar card has been given to those Indians who live in India. It is not for non-resident Indians. But you will be happy to know that the Prime Minister wants the card to be given to the NRIs the way it is issued to people living in India.

"He even wants it for OCI (Overseas Citizens of India card) holders. The matter is under our consideration. No decision has been taken as discussions on it are underway. I hope soon you will hear about it," Swaraj said during an interaction following her address.
The government has so far issued Aadhaar cards to over 92 crore citizens. Under the programme, every citizen is to be provided with a 12-digit unique identification number for which biometric information is collected.

On restricting women from going to Gulf countries through the recruiting agencies, she said the decision has been taken to stop them from getting duped.

"We will send women only through government agencies," Swaraj said during an interactive session with Indian missions abroad.

Calling upon the diaspora to be part of the India growth story, she said "It is time for you to come back to India."

Effusive in praise of the Prime Minister, Swaraj said India's engagement with the overseas Indians has increased manifold because of his constant endevour to reach out to the community. Swaraj also mentioned Modi's Madison Square address in the US and at the Wembly in London.

"Your achievements in the countries of your adoption are a matter of pride... It is our responsibility to protect you and take care of you. Indeed, we are you and you are us," she said.
Disclose foreign assets, redesignate NRO a/c and open a Resident Foreign Currency a/c to park forex earnings

India remains one of the fastest growing economies in the world. For those who are planning to return and settle in India and wish to build a focussed investment portfolio, there's no better time. However, adequate care has to be taken to ensure that your hard-earned wealth is properly diversified to minimise risk, is tax efficient and is compliant in all ways with the extant legal framework.


If you have returned to India with the intention to stay back, inform your bank for a change in your residential status in their records and re-designate your existing Non Resident Ordinary (NRO) account to resident Savings account. Also, your existing NRI demat account under the Portfolio Investment Scheme (PIS) cannot be continued anymore and a separate resident demat account should be opened and shares/units in that account should be transferred to the new account. Your Foreign Currency Non-Resident (FCNR) deposits can run till maturity but your earnings in Non Resident External (NRE) savings account will have to be transferred to resident savings account, or you have an option to transfer it to Resident Foreign Currency (RFC) account.


The account is a safe way to park your foreign exchange earnings in India. As per the extant RBI regulations, you are allowed to open a Resident Foreign Currency (RFC) Account and credit your foreign exchange earnings. Persons of Indian Origin (PIO) who, having been resident outside India for not less than 1 year, and have become resident on or after April 18, 1992, are eligible to open the account. Persons who returned to India prior to April 18, 1992 after having been resident outside India for not less than one year provided they hold Returning Indians Foreign Exchange Entitlement (RIFEE) permit are eligible as well. Interest is taxable and there is a penalty on early foreclosure of RFC deposit. Repatriation is allowed and both funds and interest thereon is free from all restrictions and can be transferred to NRE/FCNR accounts or investment outside India (see table).


As per the Indian income tax law, the moment you become a resident Indian (which given the income tax rules generally happens a couple of years after you're back in India), you start getting taxed on your 'global income'. Of course, the benefit of Double Taxation Avoidance Agreements, or DTAA, may be availed if the overseas income is also getting taxed locally. One good way you can hold the global tax liability as stated above is to plan your stay in India in such a way as to try to maintain Resident and Not Ordinary Resident (RNOR) status for the maximum possible time. In such a scenario, except for some incomes, rest of your foreign incomes will remain exempt from tax.

As per RBI norms, you are free to hold, own, transfer assets outside India if such assets were acquired by such person when he was resident outside India or inherited from a person resident outside India. However, note that if you plan to sell those assets after becoming resident Indian, there might be a capital gains tax liability under the Indian tax laws. To avoid that, it's wiser to explore the possibility of disposing off those assets before you earn Indian resident status. Also, note that the Supreme Court has clarified in the case of Keshav Mills Ltd. v. CIT [1953] 23 ITR 230 that income received outside India and remitted to India will not be considered 'receipt' and shall not be taxed in India. Some more ways to reduce tax liability on your return to India are:
> Spreading income through gifting assets to parents/major children

> Creating a separate tax file for Hindu Undivided Family (HUF) and taking advantage of separate exemption limit available to HUF

> Investing in tax-free bond issues announced from time to time


> Inform the respective companies from which you have purchased insurance or investments in India of the change in your status and new communication address. This will help the company to stop deducting the mandatory Tax Deduction at Source (TDS) on payouts at the rate of 30.9 per cent and there will be no glitches at the time of servicing.

> If your income is above exemption limit, you will have to file your tax return. In case you hold foreign assets, you need to disclose details in your tax returns. Note that the Undisclosed Foreign Income and Assets (Imposition of New Tax) Bill, 2015 imposes stringent penalties for not doing so.

> Look at your portfolio afresh, including insurance needs. Think before buying a residential house as it can lock a major portion of your savings towards retirement.

Overseas corporate bodies as an investor entity for NRIs were derecognised in September 2003
In a throwback to pre-2003 years, overseas corporate bodies (OCBs) as a vehicle for non-resident Indian (NRI) investment to India are set to make a comeback. This follows the recent move to relax foreign direct investment (FDI) norms whereby investments by companies, trusts, and partnerships, owned and controlled by NRIs (on non-repatriation basis), are to be treated as domestic investments. In effect, this indirectly recognises OCB as a class of investor entity - something that was derecognised in September 2003.
"It levels the playing field for NRI investors," says Girish Vanvari, head of tax, KPMG in India. Apart from directly investing in their individual capacity, NRIs can also use any other overseas entity that is owned and controlled by them to make the investment. "Such entity's investment will get the same treatment as given to NRI investments," says Lalit Kumar, partner in law firm J Sagar Associates.
According to Foreign Exchange Management Act, no pricing and sectoral restrictions apply if the investment is made by NRI on "non-repatriation basis". Till 2003, OCBs enjoyed the investment facilities available to NRIs. However, instances of 'OCB-shopping' by investors pushed the government to plug this route as a vehicle for NRI investment. After derecognition in 2003, such entities could invest only on repatriable-basis like any other foreign investor.
Tax experts and corporate lawyers note that NRIs will now have more avenues for structuring their investments to India. This "would allow NRIs investing on non-repatriation basis to ring-fence their Indian investments and to have the flexibility for investing though different entity structures depending on commercial and strategic considerations, administrative convenience, tax efficiency," law firm Nishith Desai Associates said in a note to its clients, while commenting on the recent relaxation in FDI norms.
Experts noted investments by such entities of NRIs on non-repatriation basis should not be included while determining whether an Indian company is a foreign-owned company. "From the perspective of downstream investment in companies engaged in sectors subject to sectoral caps or FDI-specific conditions or approval, existing limitations may not apply in case of Indian companies with investment by such entities," the note added.
According to experts, such investment on non-repatriation basis does not attract sectoral caps, filing requirements, pricing guidelines, cap on coupon rate in case of convertible instruments, such as compulsorily convertible debentures and compulsorily convertible preference shares, which are applicable for regular investments.
Experts allay the fears that the move to reinstate OCBs as a vehicle for NRI investment will lead to 'OCB-shopping'. According to Akash Gupt, leader (regulatory services) at PwC India, the regulatory environment of 2015 is very different from that of 2003. "Robust KYC (know-your-customer) norms are in place, while regulatory arbitrages have gone down," says Gupt.
It is not known if the government would want NRIs to hold 100 per cent equity in such an entity, or would allow minimum 60 per cent holding, with the balance held by other investors, as was the case in the pre-2003 OCB regime.
NRIs returning to India need to carefully manage the financial aspects of their shift..

Non-resident Indians (NRIs) should also give a lot of thought to the financial aspects of shifting back to India and the challenges that arise in its wake.


When an NRI returns to India, he should be aware of his tax residency status and file his income tax returns accordingly. Tax residency status is determined by an individual's actual physical presence in India during the financial year. To qualify as a resident, you would have to satisfy one of the following conditions: Your stay in India during the financial year should be 182 days or more; or your stay in India during the financial year should be 60 days or more and it should be 365 days or more in the four financial years preceding the current one.
Once you qualify as a resident, you need to find out whether you fall in the category of ordinarily resident (OR) or not ordinarily resident (NOR). If you meet any of the following conditions, you will qualify as an OR: you should be a resident in India in nine out of the previous 10 financial years; or, your stay in the seven years preceding the relevant financial year should altogether be 729 days or more. If you don't meet these criteria, you would be an NOR.
If your status is that of an NOR, you need to pay tax only on your Indian income but not on your global income. Once you fall in the category of OR, your entire income in India and abroad becomes taxable in India.


Once you become a resident Indian, you need to report all your foreign assets under the Undisclosed Foreign Income and Assets Bill, 2015. "Since July 2015, you have to ensure that you report all your bank accounts, financial interests, immovable property and trusts held abroad in your tax returns. These assets need to be reported even if you have no income from them. Failure to report could result in a penalty of Rs 10 lakh," says Sonu Iyer, partner and national leader, people advisory services, EY (see table: High penalty for not disclosing foreign assets).


As an NRI, you would have held NRO, NRE and FCNR accounts. The moment you become a resident Indian, the status of the NRO and NRE accounts should change to resident accounts. The FCNR account should be converted into a resident foreign currency (RFC) account. The taxation status of these accounts also changes. The NRO account is always taxable. The moment you become a resident, interest income from both NRE and FCNR accounts becomes taxable. Notify your bank and request for a change in status.


A major challenge NRIs face is in transferring the wealth they have accumulated back to India. The complexity arises especially in dealing with the money lying in your employer's retirement account, such as the 401 (k) account in the US. Since you no longer work for that employer, you may want to bring the money completely under your control. You have two options: Leave it in the US but transfer it to other types of accounts, or bring it to India. If you decide to keep the money in the US, you can move it into a traditional IRA or a Roth IRA account, which are also retirement schemes. IRA accounts are offered by asset management companies. In a 401(k) account or a traditional IRA, you pay tax at the time of retirement, that is, at the age of 59.5 years. If you decide to pay taxes on the money right away, you can invest it in a Roth IRA account, where it becomes tax-free at the time of withdrawal.

There are other challenges if you decide to bring the money to India. "You might have to pay penalties for premature withdrawal and tax on capital gains. You will have to take into account whether India has a double taxation avoidance agreement (DTAA), and whether it covers retirement funds. If there is no DTAA, you might end up paying taxes in both the countries, and could well lose 50-60 per cent of the corpus," says financial planner Ankur Kapur of ankurkapur.in. Each of these decisions could lead to penalties for premature withdrawal and tax liabilities whose impact needs to be studied in detail. You may have to seek professional help as the issue is complicated.

NRIs also need to decide whether to dispose of their real estate abroad. The main criterion should be whether you plan to use the property in the near future, say, if you wish to return to that country in a few years or plan to visit it periodically. Usually, it is not advisable to retain the property for rental income. "In countries like the US, you are not left with much after paying the high management fee and taxes. The appreciation in rental from year-to-year is also low," says Kapur.


Whether you buy a term plan on your return should depend on your age and the amount of assets you have accumulated. Someone with a corpus of, say, Rs 20 crore, may not need to buy term insurance, while another person with an asset base of only Rs 50 lakh will need to buy one.

NRIs should also buy a personal health cover for their family. "Buy a health cover a few years prior to shifting to India so that the waiting period for pre-existing diseases is crossed while the family is still abroad and the family is fully covered on its return to India," says Vishal Dhawan, chief financial planner, Plan Ahead Wealth Advisors.


NRIs, who are accustomed to the more streamlined processes and higher degree of professionalism abroad, could find themselves at sea when trying to buy a house in India. One challenge is to ascertain whether the features and amenities that the developer has advertised will come true. The second is to assess whether the developer has the financial strength to deliver the project on time. Third, developers might advertise that various infrastructure projects will come up in their area, which will boost the prices of apartments in their project. NRIs need advice regarding whether these projects will come up at all and whether this will happen within the time frames mentioned.

Before setting out to make a purchase, NRIs should do a lot of homework. Many developers provide information about their projects on their web sites. Property portals also provide listings of projects with details about them. "Zero in on a few reputed developers and a few projects whose specifications match your requirements," says Ashutosh Limaye, head of research and REIS, JLL India. To evaluate a developer, look at the construction quality of his past projects and his track record for timely completion and providing the promised specifications. For most NRIs, it might be a good idea to engage a professional broking agency. "That agency should be able to tell you whether all the permissions are in place and offer advice on the infrastructure projects slated to come up in the area. It should also be able to offer an assessment of the project's potential for price appreciation," says Limaye.
In a bid to woo non-resident Indians (NRIs) from Uttar Pradesh to invest in the state, the state government launched a website for them late Sunday, officials said.

The exclusive website aims to be a single window gateway for the NRIs native to UP and now settled overseas, an official told IANS.

Claiming that the website received a large number of hits and queries within hours of its launch, Mohammad Wali Abbas, head of the information and technology cell of the NRI department in Udyog Bandhu, an autonomous government body dealing with investment, said that the website would "showcase to the world that UP (Uttar Pradesh) was pretty serious about investment, specially from the NRIs".

Investment apart, the website, officials said would also encourage the emotional bonding of NRIs with their mother land, ensure the general welfare of NRIs and in case of emergencies monitor special problems faced by them and coordinate with the Government of India.

The NRI department would also offer to help in the coordination of technical, managerial and financial resources of the NRIs from UP.

A 24x7 call centre ( Migrant Resource Centre) where NRIs can log complaints will be established and the UP government is also planning to felicitate outstanding performers from among the NRIs as per their approach and investment for the state.

Government officials said that the state would also celebrate "UP NRI Day" every year, beginning Jan 17 next year. Madhukar Jaitley, advisor to the NRI department told IANS that the website was "by far the most serious and well meaning effort by the state government to bond with the NRIs".

Non-resident Indians have recently been allowed to open accounts under the National Pension System (NPS). By opening an NPS account, NRIs can create a pension corpus in India.


An NRI between 18 and 60 years of age can open an NPS account. The account needs to be opened by the individual NRI as power of attorney is not allowed.


NPS subscriber registration form for NRIs needs to be filled. This form can be downloaded and is available at any POP-SP. Overseas address and contact details as well as permanent Indian address need to be provided. NRIs have the option of selecting the Pension Fund Manager.


The following documents need to be submitted to the POP bank for opening the NPS account:

a) Completed subscriber registration form

b) Copy of passport

c) Proof of address, if the local address is different from the address in the passport.


The contributions made into the NPS account by the NRIs can be from either NRE or NRO accounts subject to normal foreign exchange conversion norms.


After submission of documents, the NRI can check the status by accessing https://cra-nsdl.com/CRA/ by using the 17 digit receipt number provided by POP-SP or the acknowledgement number allotted by CRA-FC (Facilitation Centre) at the time of submission of application forms by POP-SP.


1) If the NRI has taxable income in India, he can get additional benefit of `50,000 offered by NPS over and above the 80C benefits.

2) It is preferable to open an NPS account through the POP bank where the NRI maintains his NRE/NRO account.

3) At the time of payment of pension or annuity, the same is paid only in INR. There is no restriction on repatriation.

(The content on this page is courtesy Centre for Investment Education and Learning (CIEL). Contributions by Girija Gadre, Arti Bhargava and Labdhi Mehta.)
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