What is the Difference Between NRI and OCI | HDFC Bank (2024)

FAQs

What is the Difference Between NRI and OCI | HDFC Bank? ›

An NRI can invest in residential/commercial properties but is not allowed to invest in agricultural or plantation property or a farmhouse. An OCI can invest in various financial investment opportunities available in India.

An OCI cardholder gets the permission of living within Indian territory for an indefinite period of time. Whereas, an NRI does not enjoy these benefits and either has to rely on a visa for a certain period of time.

Further, an OCI can open all types of accounts allowed to a Resident customer. 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.

Types of NRI Accounts

As mentioned earlier, there are three types of accounts available to NRIs in India – NRE stands for Non-Resident External Account, NRO stands for Non-Resident Ordinary Account, and FCNR (Foreign Currency Non-Resident) bank Account.

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.

(ii) A PIO cardholder is required to register with local Police authority for any stay exceeding 180 days in India on any single visit whereas an OCI is exempted from registration with Police authority for any length of stay in India.

Limits on Transactions

According to the Liberalised Remittance Scheme, you are allowed to send no more than USD 2,50,000 in a given year. So yes, money can be sent from India to America with no problems if sent for the correct purpose.

Exemption on sale of property for an NRI

Long-term capital gains are taxed at 20%. Do note that long-term capital gains earned by NRIs are subject to a TDS of 20%. NRIs can claim exemptions under Section 54, Section 54EC, and Section 54F on long-term capital gains.

AN OCI's foreign income and interests from non-resident rupee bank accounts are exempted from being taxed. However, all their income from Indian sources shall be liable to Indian taxes. This is because taxability in India is not determined by the country of origin.

Can NRI have normal bank account? ›

Can NRI have savings account in India? Most individuals make the mistake of continuing a resident savings account even after becoming an NRI but the law does not allow it. Or in simple words, it's ILLEGAL to hold resident savings bank account for NRIs.

Best Bank for NRI Saving Account. Some of the best banks for NRI saving account are Axis Bank, ICICI, HDFC, Kotak Mahindra, Bank of Baroda, Deutsche Bank, and the State Bank of India (SBI). They offer attractive rates and best services.

HDFC Bank, India's No. 1 Bank for NRI Services, offers you a range of banking tools custom-made for NRIs. We offer you a one-stop-shop for all NRI services, from banking to investment to loan.

Nowadays, most banks require just Rs. 10,000 as a minimum balance. FCNR Deposit: In addition to NRE/NRO saving accounts and NRE/NRO fixed deposits you also have an option of booking Foreign Currency Deposits.

The OCI card benefits refer to the rights you gain, like working rights, living as a resident, and entering India as many times as you want. One of the major drawbacks is that you must surrender your Indian passport as India doesn't accept dual citizenship.

Foreign nationals cannot apply for OCI in India while on Tourist Visa, Missionary Visa and Mountaineering Visa. Moreover, the foreigner has to be ordinarily resident of India to be eligible to apply for OCI registration in India.

A. As per the guidelines issued by Reserve Bank of India, an NRI or OCI card holder can invest in any residential or commercial property. The guidelines also state that one can buy any number of residential or commercial properties.

Can I open an NRI account from USA? ›

You can open NRI Account for Indians staying in America with HDFC Bank. Make the most of the features and benefits offered through our simple and smarter banking solutions. Effortless and seamless repatriation of funds to your country of residence through our NRE Account.

Yes. You can apply for an NRI account online through a bank's website. You can fill an NRI account opening form online and upload required documents.

There's no limit to how much of a foreign currency you can take out of India. But, if it's US$5,000 or more in banknotes and coins, or US$10,000 or more in coins, notes, and traveller's cheques, it will have to be declared¹.

Foreign Currency and Local Currency (USD)- There is no limit to bring USD or any other currency in the US. You may bring upto USD 10,000 in form of currency notes, coins, travelers check etc.

Payment can be made in cash, money order, cashier's check, or banker's check. If applying by post cash is not accepted. No personal checks are accepted. Non-US passport holders and non-USA nationals residing in the US for less than 2 years have to pay $20 additional fee as reference fee.

As per the most recent 2023 Budget, which came into effect from February 1, NRIs and resident Indians alike are not required to file their Income Tax Returns (ITRs) if their total income for the year is below the basic exemption limit of Rs300,000 (Dh13,452).

NRIs have to pay income tax on income earned in India. NRIs have to pay tax on income that accrues or arises in India. NRIs also need to pay tax on income which is deemed to accrue or arise in India. Money received or deemed to be received in India is taxable.

The foreign income i.e. income accruing or arising outside India in any financial year is liable to income-tax in that year even if it is not received or brought into India. There is no escape from liability to income-tax even if the remittance of income is restricted by the foreign country.

The OCI is not allowed to vote, to serve in the Legislative Assembly, Legislative Council, or Parliament, to hold constitutional positions such as President, Vice President, Judge of the Supreme Court or High Court, or to work for the government in any capacity.

Overseas Citizenship of India (OCI) is a form of permanent residency available to people of Indian origin and their spouses which allows them to live and work in India indefinitely.

How much is new OCI fee in India? ›

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.

The Foreign Exchange Management Act (FEMA) states that NRIs cannot hold resident accounts. So, all your accounts have to be either closed or converted into NRI Accounts. You can convert them into Non-Resident Ordinary (NRO) Accounts and continue to deposit funds generated within India into them.

NRIs live abroad and earn money abroad but many of them have money in India through passive earning such as rent or through the sale of investments and property. It is possible for them to transfer these funds outside India provided they follow the regulations laid down by RBI.

NRIs can get the personal loan amount from the bank in their NRE or NRO accounts. Most lenders provide the loan amount in Indian rupees. However, some banks also provide these loans in foreign currency. You may check the lender to know about the mode in which the loan amount is disbursed.

An NRE account is a bank account opened in India in the name of an NRI, to park his foreign earnings; whereas, an NRO account is a bank account opened in India in the name of an NRI, to manage the income earned by him in India. These incomes include rent, dividend, pension, interest, etc.

The NRE account can only be opened by an NRI personally and not by a power of attorney holder. One can maintain more than one NRE accounts in India. An NRE account/s can be jointly opened with any other NRIs but not with any other resident.

Q: What are the benefits available to an OCI Card holder? A: An OCI card holder gets the following benefits: A multiple entry, multi-purpose life-long visa for visiting India. Exemption from registration with local police authority for any length of stay in India.

Which is better OCI or Indian visa? ›

The India Tourist eVisa is available for foreign travelers who want to visit India for tourism. On the other hand, the OCI Card allows you to live and work in India. In both cases, you must check eligibility and whether you meet the requirements.

Overseas Citizenship of India (OCI) is a form of permanent residency available to people of Indian origin and their spouses which allows them to live and work in India indefinitely.

There is no separate procedure to be followed for filing tax returns in India as an Overseas Citizen of India card (OCI) holder. He can continue filing returns in India as a non-resident. Further, his PAN and Aadhaar are valid as an OCI.

If your status is 'resident', your global income is taxable in India. If your status is 'NRI,' your income earned or accrued in India is taxable in India.

Q: Can OCI card holders purchase property in India? A: OCI card holders can purchase residential and commercial properties in India. But they are not permitted to purchase agricultural land, including farmland or any kind of plantation property.

OCI application normally takes 8-10 weeks for processing. The complete processing of OCI card involves a number of steps. The processing can be further delayed because of incomplete applications.

OCI Card For PIO Card Holder

A Person in India (PIO) card allows the holder to stay in the country visa-free for a 15-day period. If you are a PIO card holder, you can still apply for the OCI card. The OCI fee for a PIO card is the same: $275 consular fee, $3 ICWF fee, and additional service fee.