I have recently become a resident of the US. I retain my Indian citizenship and have bank accounts in India, which I have converted into Non-Resident Ordinary (NRO) accounts and have also opened a dollar Non-resident Rupee (NRE) account in the US. When I wanted to transfer the rupees into my account in the US, my bank asked for a certificate from a chartered accountant. I have always been a salaried person . How should I get this certificate? Also, in the absence of this certificate, I transferred the money into my brother’s account and he wired the money into my account in the US. Was this the right thing to do?
Under the exchange control law, a non-resident Indian (NRI) can remit up to $1 million per financial year out of balances held in NRO accounts, and from sale proceeds of assets or assets acquired in India by way of inheritance on submission of documentary evidence and certificate from a chartered accountant in the prescribed format.
As an NRI, under the exchange control law of India, you can remit money from NRO accounts as per the provisions stated above. Your brother can remit money outside India under the Liberalized Remittance Scheme as he qualifies as a resident Indian under the exchange control law of India. Under this, a person who is a resident of India can remit up to $250,000 per financial year for permitted current account transactions, which includes maintenance of close relatives abroad.
Sonu Iyer is tax partner & people advisory services leader, EY India.
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