How NRIs Can Transfer Money Outside India Legally?

Sending money outside India might be difficult for non-resident Indians (NRIs), whether for personal investments, supporting family members abroad, or other reasons. To make this easier, Indian banks offer two types of accounts: Non-Resident External (NRE), Non-Resident Ordinary (NRO), and FCNR Account (foreign currency non-resident) bank accounts.

However, sending money outside India is often easy, so following specific guidelines and other rules is important to ensure legal and hassle-free transactions.

This article will explain the methods and guidelines that NRIs should follow to transfer money outside India legally:

There are various types of accounts available for transferring money outside India

NRIs must make sure they have the right types of bank accounts before sending money overseas.

1. NRE Account: This account mainly transfers foreign income to India. Additionally, the NRE account may be managed from anywhere in the world using Internet banking. In India, there are no taxes on the capital or interest, and the money may be freely repatriated. Most of these accounts are used for Investments, business, and personal banking.
2. NRO Account: Dividends and rent received in India are deposited into this account. It can also be used as a current, savings, recurring, or FD account. This account allows you to transfer money outside India, but there are restrictions on how much you can bring back, and the interest is taxable.
3. FCNR Account: This FCNR Account has to be opened and maintained in foreign currency without being converted to rupees. In this account, the interest earned on the amount is not taxed in India.

Online Money Transfer Services:

Digital platforms like Paypal, Razorpay, and Wise allow easy, fast, and secure online transfers. These services can be good for smaller amounts of money. They are typically transparent about fees and exchange rates. These business functions act as service providers that collect money so you may make transactions online. Transferring money from India to abroad can take 1 to 2 days.

Important documentation for transferring money outside India :

While transferring money outside India is legal, NRIs must make sure that all transactions are clear and by Indian laws. The following are the main compliance points:

1. Form 15CA and 15CB: These are significant papers that must be filed under the Income Tax Act of 1961 for payments made by a resident to an NRI. Form 15CA is a declaration by the person sending money, and Form 15CB is a certificate from a chartered accountant confirming the payment follows tax rules and any applicable double taxation agreements.
2. Pan card: A pan card is necessary for significant transactions, particularly those involving investments or the acquisition of real estate. This guarantees that every money is correctly recorded for taxation.

For more information, you can contact us at info@kdpaccountants.com

Conclusion:

Transferring money outside India is a straightforward process as long as NRIs follow the legal steps and stay compliant with FEMA and RBI regulations. Using NRE/NRO accounts, FCNR accounts, or online services your money will arrive at its destination securely and compliantly.

At KDP Accountants, we offer professional expert guidance on tax planning, compliance, and smooth money transfers outside India. Our professional team will help you navigate the smooth process and ensure your transactions are hassle-free and fully compliant with Indian regulations.