An Indian abroad is popularly known as Non-Resident Indian (NRI). The NRI status is legally defined under the Foreign Exchange Management Act, 1999 and the Income Tax Act, 1961 for applicability of respective laws.
Non resident under FEMA 1999: Person resident outside India means a person who is not resident in India.
Person resident in India means:
A person residing in India for more than one hundred and eighty-two days during the course of the preceding financial year but does not include—
(A) A person who has gone out of India or who stays outside India, in either case—
• For or on taking up employment outside India, or
• For carrying on outside India a business or vocation outside India, or
• For any other purpose, in such circumstances as would indicate his intention to stay outside India for an uncertain period;
(B) A person who has come to or stays in India, in either case, otherwise than—
• For or on taking up employment in India, or
• For carrying on in India a business or vocation in India, or
• for any other purpose, in such circumstances as would indicate his intention to stay in India for an uncertain period;
Any person or body corporate registered or incorporated in India,
An office, branch or agency in India owned or controlled by a person resident outside India,
An office, branch or agency outside India owned or controlled by a person resident in India;
Non resident under income-tax act, 1961/wealth tax
The term non-resident is negatively defined under section 6 of the Income-tax Act. An individual who is not a resident under the Income-tax Act is a non-resident (generally, termed NRI). Thus, one should know the definition of a resident and if he is not a resident then he is a non-resident.
The status of a person as a resident or non-resident depends on his period of stay in India. The period of stay is counted in number of days for each financial year beginning from 1st April to 31st March (known as previous year under the Income-tax Act). The definition is explained in simple terms as under.
If an individual who satisfies understated both the conditions of section 6 of the Income-tax Act, then he becomes a non-resident.
Condition
Status
1. He is not in India for 182 days or more during the
relevant previous year
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If yes, then he is a non-resident.
(so check the next condition.)
2. He is not in India for 60 days or more during the previous year and he is not in India for 365 days or more during the 4 years prior to the previous year.
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If yes, then he is a non-resident.
If you are not satisfying any of the above conditions to become non-resident, check whether following assists you to become a non-resident.
In the case of an individual on visit to India or a member of the crew of an Indian ship or a person leaving India for employment outside India, the requirement of stay in India of 60 days in condition 2 above is extended to 182 days.
Resident but not ordinarily Resident (RNOR)
A NRI who has returned to India for good is covered under the provisions of section 6(6) of the Income-tax Act. He is given a special status of Resident but not ordinarily Resident (RNOR) if he satisfies one of the following conditions:
Condition
Status
1.He is not a resident, as per the above provisions, for at least 9 out of 10 previous years prior to the previous year under consideration.
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If yes, he is RNOR
2. His stay in India during the 7 previous year prior to the previous year under consideration should not be 730 days or more.
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If yes, he is RNOR
Note : An individual who is non-resident for 2 consecutive years, shall remain RNOR for 9 subsequent years and as such his foreign income is not taxable in India while his status RNOR. The status of RNOR renders certain income of such individual non-taxable as explained in Tax liability of NRIs.
However, the above definition was amended in the Indian Finance Act, 2003*. The revised conditions applicable from Financial year April, 2003 to March 2004 are as under:
Condition
Status
1.He is non-resident, as per the above provisions, for at least 9 out of 10 previous years prior to the previous year under consideration
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If yes, he is RNOR
2. His stay in India during the 7 previous year prior to the previous year under consideration should be 729 days or less
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If yes, he is RNOR
Note: An individual who is non-resident for 9 consecutive years, shall remain RNOR for 2 subsequent years and as such his foreign income is not taxable in India while his status is that of RNOR. The status of RNOR renders certain income of such individual non-taxable as explained in Tax liability of NRIs.
A person who is returning to India after 9 years of stay outside India (and who was non-resident for each of the 9 years under the Income Tax Act, 1961), shall remain RNOR for a period of two years only.
Where can we help?
Taxation
Determination of your residential status in India
Interpretation of DTAA with a view to reduce tax liability in India
Handling of issues relating to inheritance, will, etc.
Compliances with respect to the income-tax Act, 1961, Wealth-tax Act, etc.
Application for Permanent Account Number (PAN)
Filing of India tax return
Advising suitable tax saving investments
Representation before tax authorities, in case required
Opening if various bank accounts and compliances thereon
Various compliances in regard to repatriation of funds/investments/property, etc.
Person of Indian Origin
A Person of Indian Origin (PIO) is literally, simply a person of Indian origin who is not a citizen of India.
PIO for the purpose of acquisition and transfer of immovable property in India
PIO means a citizen of any country other than Bangladesh or Pakistan or Sri Lanka or Afghanistan or China or Iran or Nepal or Bhutan if –
He at any time held Indian passport or
He or either of his parents or any of his grandparents was a citizen of India by virtue of the Constitution of India of the Citizenship Act, 1955
PIO for the purpose of investment of shares in India / opening non-resident account in India/ remittance of assets
PIO means a citizen of any country other than Bangladesh or Pakistan, if-
He at any time held Indian passport or
He or either of his parents or any of his grandparents was a citizen of India by virtue of the Constitution of India of the Citizenship Act, 1955 or
The person is a spouse of an Indian citizen or a person referred to in above sub-clauses.
PIO CARD
Eligibility:
Any person other than a citizen of Bangladesh or Pakistan -
who at any time held an Indian passport;
He/she or either of his/her parents or grand parents or great grand parents was born in and permanently resident in India as defined in the Government of India Act ,1935 and other territories that become part of India thereafter provided neither was at any time a citizen of any of the country as may be specified by Central Government from time to time; or
Who is a spouse of a citizen of India or a person of Indian origin as mentioned above.
The scheme is broad-based, covers up to four generations and also the foreign spouse of a citizen of India or a PIO.
Benefits:
The benefits accruing to a PIO card holder:
No requirement of visa to visit India;
No separate "student Visa" or "Employment Visa" required for admission in colleges/ institution or for taking up employment respectively;
A PIO card holder will be exempt from the requirement of registration if his stay on any single visit in India does not exceed 180 days.
In the event o continuous stay in India of the PIO card holder exceeding 180 days, he/she shall have to get himself/herself registered within 30 days of the expiry of 180 days with the concerned Foreigners Regional Registration Officer/Foreigners Registration Officer.
Parity with Non-Resident Indians in respect of facilities available to the latter in economic, financial and educational field.
All PIOs including PIO card holders shall enjoy parity with NRIs in respect of all facilities in the matter of acquisition, holding, transfer and disposal of immovable properties in India except in matters relating to the acquisition of agricultural/plantation properties. No parity shall be allowed in the sphere of political rights.
Facilities available to children of NRIs for getting admission to educational institutions in India including medical colleges, engineering colleges, Institute of technology, Institute of management, etc. under general categories.
facilities available under the various housing scheme of LIC, State Government and other Government Agencies.
special counters at the immigration check posts for speedy clearance.
Where can we help?
FEMA/RBI
Application for issue of PIO card
Follow up with the authorities for early issue of PIO card and making all compliances
Application for issue of duplicate PIO card (in case of loss, etc. of original PIO card)
Returning NRI's
NRI who return to India for good, should know various aspects of Foreign Exchange Regulations (FEMA), Indian Taxation and Banking Regulations in order to rearrange his financial affairs in India and outside India.
When relocating to India, the following aspects should be taken care of:
Compliance of Baggage Rules in India regarding repatriation of overseas assets
Redesignation of all Indian bank accounts as Resident accounts
Opening of and compliances in respect of ‘Resident foreign currency’ (RFC) account
Information to all companies, funds, etc., of whom shares and securities are held by the non-resident, regarding the change of residential status/relocation to India
Compliance in respect of the Indian income-tax Act, 1961 e.g. application for PAN in case you do not have a PAN
Compliances in respect of Wealth-tax Act, in case required e.g. filing of wealth-tax return
Miscellaneous other issues
Where can we help?
FEMA/RBI
Compliances regarding repatriation of assets to India
Procedure for redesignation of all Indian bank accounts
Opening of ‘Resident foreign currency’ (RFC) account
Information to all companies, funds, etc., of whom shares and securities are held by the non-resident, regarding the change of residential status/relocation to India
Compliance in respect of the Indian income-tax Act, 1961 e.g. application for PAN in case you do not have a PAN
Compliances in respect of Wealth-tax Act, in case required e.g. filing of wealth-tax return
Repatriation of legacies/inherited assets and taxability in India thereon
Accounting Services
Our Services Include:-
Book keeping
Management accounting
Forecasting
Budgeting
We offer a full range of accounting and bookkeeping services. Accounting and bookkeeping needs are different for sole proprietorship, small businesses, mid sized businesses or large conglomerates. We offer tailor-made accounting systems, to cater to this varied requirement, In this modern jet age, where there is fierce competition in the trade and industry and entrepreneurs are vying with one another in the mad race to stay ahead of others , it has become most imperative for the CEOs and other junior staff to keep themselves fully updated with the statistics of the working of a business house and its current affairs required for planning and formulations of policies of the Company. This is possible only if the accounts are maintained in an elaborate manner and kept up to date minute to minute We keep the most competent and efficient staff to meet with this important requirement of our clients and readily furnish every data and information as and when required .
We provide accurate and timely services, whether it is a full service accounting and book-keeping plan or quarterly updates and financial statement preparation. Our services include:
Book-Keeping
Daily Online Access And Timely Reporting Via The Internet
Payroll Reconciliation
Checking Account Reconciliation
Accounts Receivable/Payable Reconciliations
Data Entry / Comparison of data from hard copy to soft copy and visa versa
Capital Planning And Investment Management
Preparation Of Management Accounts And Statutory Accounts.
Separate Currency And Investment Gain/Loss Accounting
Partnership Accounting
International Taxation
International taxation is a branch of knowledge pertaining to the international aspects of tax laws and international tax treaties. The taxation is imposed on the residents of a particular country residing in that country and earning an income, both as an employee and as self-employed, corporations and commercial organizations based in that country and engaged business operations to make profits, foreign-based corporations and commercial organizations but engaged in business operations to make profits within the territories of that country.
Individual or corporate taxable income which is earned in a foreign country is exempted under the legal system pertaining to taxation of the country in order to avoid double taxation, i.e. taxation is imposed twice. In India, the taxation is based on the Income tax Act. The study of international taxation are based on the factors governing the taxation system of a particular country, and being familiar with those factors is the job of an expert on international taxation.
We, at NRI Tax Service, are very well versed with the knowledge on laws administrating the international taxation which plays an important part in the analysis of the international taxation.
RBI
"Reserve Bank" means the Reserve Bank of India constituted under sub-section (1) of section 3 of the Reserve Bank of India Act, 1934 (2 of 1934).
The Reserve Bank may, in consultation with the Central Government, specify-
any class or classes of capital account transactions which are permissible;
the limit up to which foreign exchange shall be admissible for such transactions: Provided that the Reserve Bank shall not impose any restriction on the drawal of foreign exchange for payments due on account of amortization of loans or for depreciation of direct investments in the ordinary courts of business.
The Reserve Bank may, by regulations, prohibit, restrict or regulate the following-
transfer or issue of any foreign security by a person resident in India;
transfer or issue of any security by a person resident outside India;
transfer or issue of any security or foreign security by any branch, office or agency in India of a person resident outside India;
any borrowing or lending in rupees in whatever form or by whatever name called;
any borrowing or lending in rupees in whatever form or by whatever name called between a person resident in India and a person resident outside India;
deposits between persons resident in India and persons resident outside India;
export, import or holding of currency or currency notes;
transfer of immovable property outside India, other than a lease not exceeding five years, by a person resident in India;
acquisition or transfer of immovable property in India, other than a lease not exceeding five years, by a person resident outside India;
giving of a guarantee or surety in respect of any debt, obligation or other liability incurred-
by a person resident in India and owed to a person resident outside India; or
by a person resident outside India.
The Reserve Bank may, by regulation, prohibit, restrict, or regulate establishment in India of a branch, office or other place of business by a person resident outside India, for carrying on any activity relating to such branch, office or other place of business.
Export of goods and services:-
Every exporter of goods shall-
furnish to the Reserve Bank or to such other authority a declaration in such form and in such manner as may be specified, containing true and correct material particulars, including the amount representing the full export value or, if the full export value of the goods is not ascertainable at the time of export, the value which the exporter, having regard to the prevailing market conditions, expects to receive on the sale of the goods in a market outside India;
furnish to the Reserve Bank such other information as may be required by the Reserve Bank for the purpose of ensuring the realization of the export proceeds by such exporter.
The Reserve Bank may, for the purpose of ensuring that the full export value of the goods or such reduced value of the goods as the Reserve Bank determines, having regard to the prevailing market conditions, is received without any delay, direct any exporter to comply with such requirements as it deems fit.
Every exporter of services shall furnish to the Reserve Bank or to such other authorities a declaration in such form and in such manner as may be specified, containing the true and correct material particulars in relation to payment for such services.
