HDFC Bank Non-Resident Ordinary (NRO) Savings Account (2024)

FAQs

HDFC Bank Non-Resident Ordinary (NRO) Savings Account? ›

NRO or Non-Resident Ordinary Accounts is meant for NRIs or Non-Resident Indians to keep funds that are also existent prior to becoming a Non-Resident Indian and also the funds earned by them within the country such as rent, Indian Salary, dividends and so on.

NRO or Non-Resident Ordinary Accounts is meant for NRIs or Non-Resident Indians to keep funds that are also existent prior to becoming a Non-Resident Indian and also the funds earned by them within the country such as rent, Indian Salary, dividends and so on.

An NRE account can be used as a bank account to transfer foreign earnings to India in Indian rupees. An NRO account can be used as a savings account to manage the income earned in India by an NRI in Indian rupees. This can include pension, rental income, dividend income, etc.

To open NRO Savings Account from Canada, you must be: A Non-Resident Indian. An Indian citizen residing overseas for reasons such as employment, education, or business on an appropriate visa. An Individual deputed or posted in the United Nations or abroad by the Indian Government or a PSU unit.

Features of an NRO Account:

With an NRO Account, you are free to repatriate or transfer the interest you earn on the principal amount deposited. You can also transfer the principal amount within specified limits. As per rules, you can transfer up to USD 1 million in one financial year post payment of applicable taxes.

You should opt for NRO Accounts if you want to save your earnings from India in Indian currency itself. These earnings could include rent, income, dividend, sale of Property etc.

The Non-Resident Ordinary (NRO) Account are primarily opened for depositing rupees earned in India. Foreign earnings can also be deposited in this account. When an Indian citizen goes abroad for a job with an intention to stay there, his resident accounts should be converted into an NRO Account by the bank.

A joint account with Resident Indian (RI) who is a close relative can also be opened subject to following conditions: Mode of operation permitted is 'Former (NRI) or Survivor' only. The NRI (PIO / OCI) will be the primary/first account holder in the joint account and RI will be the second applicant.

You may be able to open a bank account with the proper identification in Canada even if: you're not a Canadian citizen. you live in another country.

Is NRO account taxable in Canada? ›

Tax rules for interest income from NRO account

The interest income on funds in an NRO account is subject to tax deducted at source (TDS). A 30% tax on the NRO account, in addition to the applicable cess and surcharge, is levied on the interest income from these accounts.

As per FEMA rules, the penalty for not converting a resident account to an NRO account is up to 3 times the amount in the account or INR 2 lakh when the sum is not quantifiable.

An NRI can open a joint NRO account with one or more NRIs or Indian citizens. However, there can be a joint NRE account only with another NRI. Income originating outside India can be deposited into any of these accounts. However, income originating within India can be deposited only into the NRO account.

One of the major disadvantages of an NRO account is the cap of USD 1 million on the repatriation of funds. Moreover, the interest income of an NRO account is also subject to taxes.

HDFC Bank allows conversion of your existing Resident account to NRO account by simply emailing the required documents to the Branch via your register email id.

After you become an NRI, you must open either a Non-Resident External (NRE) or a Non-Resident Ordinary (NRO) account to do any banking transactions in India. NRIs must open an NRE account to park their foreign earnings; and an NRO account for their earnings in India such as rental income, dividend, pension etc.

You may be considered a non-resident of Canada if you did not have significant residential ties with Canada and: You lived outside Canada throughout the year (except if you were a deemed resident of Canada) You stayed in Canada for less than 183 days in the tax year.

Can an NRI maintain multiple accounts with different banks in India, simultaneously ? Ans.: Yes, there is no prohibition to open and maintain multiple accounts a/cs.

An NRE account is for your foreign income earned outside India and is tax-free whereas an NRO account is for your income earned in India such as sale of property, rent, investments made in resident tenor etc. Like all Savings Accounts, few documents are required for opening NRI Account.

Should I transfer money to NRE or NRO account? ›

In summary, NRIs should opt for NRE accounts if they want to hold or maintain their overseas earnings in Indian currency and NRO accounts if they want to save their earnings from India in Indian currency itself. Both accounts provide high liquidity, allowing easy withdrawals and deposits.

Canadian financial institutions and other payers have to withhold non-resident tax at a rate of 25% on certain types of Canadian-source income they pay or credit to you as a non-resident of Canada. The most common types of income that could be subject to non-resident withholding tax include: interest. dividends.

What is a Non-Resident? According to Section 6(6)(a) of the Income Tax Act of 1961, an individual is a NOR if he or she has been a non-resident in India for 9 out of the previous 10 years, or has spent less than 729 days in India in the previous seven years preceding that year.

If you are not a U.S. citizen, you are considered a nonresident of the United States for U.S. tax purposes unless you meet one of two tests. You are a resident of the United States for tax purposes if you meet either the green card test or the substantial presence test for the calendar year (January 1 – December 31).

Open a non-resident tax account

You can open a non-resident account online through My Account, My Business Account or Represent a client. Once you have logged in, select “Open a non-resident tax account” from the menu.

Penalties for not converting to NRO account

Under the Act, any individual who fails to adhere to the guidelines is liable to pay a penalty of up to 3 times the amount involved in the existing resident savings account or Rs 2 lakh when the sum is not quantifiable.

Can I transfer money from normal savings account to NRO account? Yes, you can transfer money from a normal resident account to NRO account.

Tax-Free Savings Account (TFSA), Home Buyers' Plan (HBP), and Lifelong Learning Plan (LLP) If you hold a TFSA when you leave Canada, you can keep it and continue to benefit from the exemption from Canadian tax on investment income and withdrawals.

Can I open a Canadian bank account without a Canadian address? ›

Canadian banks will typically require you to be resident in the country before considering opening an account for you. This means you'll need proof of address, identity documents, immigration documents, and a government-issued reference number to progress your bank account application.

If you are an NRI you need to open an NRO, NRE, or FCNR-B account in India and the NRI can transfer funds to an overseas account in the country in which the NRI resides.

An NRO account restricts you from remitting more than USD 1 million inclusive of taxes during an assessment year. You can repatriate the interest amount freely, but the principal amount can be repatriated only within set limits.

Once you come back to India permanently, you are a resident as per FEMA. And residents are not permitted to keep a NRE account. Interest on NRE FD is tax exempted only for Non-Residents. Therefore from the day you come back to India any interest earned in NRE FD becomes taxable in your hand.

An NRO (Non-resident Ordinary) is a savings account that can be opened by Non-resident Indians. All that the NRI needs to do is to convert his/her regular savings account held in the country to a NRO account.

Upto $1 million can be remitted outside India or transferred to your NRE account every year subject to some procedural compliances from NRO account. The money in NRO account can also be used for making regular local payments in rupee like rents for property, taxes.

As of the financial year 2021-2022, the LRS limit for NRIs is INR 2,50,00,000 per financial year. This limit applies to the total amount of funds transferred by an NRI during the financial year, and includes all transfers made for any purpose, including investments, gifts, and personal expenses.

What minimum balance would I be required to maintain in my NRE/NRO account? The minimum Monthly average balance (MAB) required to be maintained is INR 10000 at an account level OR INR 25,000 at Customer ID level.

The Reserve Bank of India allows the transfer of funds up to USD 1 million a year from an NRO to an NRE account.

What is the difference between NRO and ordinary account? ›

Purpose. An NRE account can be used as a bank account to transfer foreign earnings to India in Indian rupees. An NRO account can be used as a savings account to manage the income earned in India by an NRI in Indian rupees. This can include pension, rental income, dividend income, etc.

A Non-Resident External (NRE) account helps an NRI store their foreign currency savings in an Indian bank. Using an NRE account, an account holder can deposit money in any foreign denomination and withdraw it in INR (Indian Rupees).

Additionally, a penalty of Rs 5,000 is to be charged every day from the first day of intervention until the penalty is paid.” These are the documents required for conversion of savings account to NRE account, according to the HDFC Bank website. Self-attested copies of passport and Visa to prove his/her NRI status.

This account allows you to receive funds in either Indian or foreign currency. However, only Indian currency can be withdrawn as NRO Accounts are kept in Indian currency and cannot be freely repatriated into any foreign currency.

Higher Debit Card Limits

*Per day ATM withdrawal limit on your Debit Card is now capped at ₹2 lacs for security purposes. Cash withdrawal facility can now be availed across merchant establishments with a maximum upper limit of Rs. 1,000/ day on your HDFC Bank Debit Cards.

One of the major differences between an NRE and NRO Savings Account is the option each of them offer for deposit of funds. An NRE Savings Account will only allow you to deposit funds in a foreign currency while in an NRO Savings Account, you can also deposit funds in Indian Rupees.

An NRO (Non-Resident Ordinary) savings account is where you can maintain and manage your income earned in India such as rent, dividends, pension etc.

An NRI Account refers to the accounts opened by a Non-Resident Indian (NRI) or a Person of Indian Origin (PIO) with a bank or financial institution which is authorised by the Reserve Bank of India (RBI), to provide various services.

What is the difference between NRE and NRO fixed deposit? ›

Only your NRO fixed deposit interest can be transferred to a foreign account. An NRE FD, on the other hand, allows you to fully repatriate funds to a foreign account, including the Principal and accrued interest. Transferring the Principal and earned withdrawals to an Indian account is made easier in this manner.

Penalties for not converting to NRO account

Under the Act, any individual who fails to adhere to the guidelines is liable to pay a penalty of up to 3 times the amount involved in the existing resident savings account or Rs 2 lakh when the sum is not quantifiable.

Money can be deposited in foreign as well as Indian currency but can be withdrawn only in the Indian currency. The best benefit of an NRO account is that money earned in India by an NRI can be saved in India. It can be used as a savings or a current account.

You may be able to open a bank account with the proper identification in Canada even if: you're not a Canadian citizen. you live in another country.

Yes, a foreigner can open a bank account in the U.S., it just takes some additional paperwork to make it happen. If you have a foreign government ID, passport or resident alien number from a green card, those will help. If you don't have a Social Security number, you'll need an ITIN.

A non-resident bank account is an account you can open in a central location based in a country or territory you don't currently live in. These accounts are also referred to as Offshore Bank Accounts or Offshore Accounts.

While an NRE account is fully repatriable tax free, under an NRO you can still repatriate the balance but you are required to pay taxes on the repatriated amount. This crucial difference is why the NRO account is more ideal for those that want to keep their funds in the country.

Yes, an individual can open both NRE and NRO accounts to meet his needs. If you have any income arising in India, you can receive it in NRO account, and if you want to park your earnings abroad in India, you can open an NRE account.