Pointers for NRI who is planning his return to India

An article from Economictimes

Here are some pointers for the NRI who is planning his return to India:

1. An NRI who is relocating to India as per ruling of the FEMA act, can bring back his assets and pay no tax on them in India. The assets accumulated in the foreign country would have been subject to local tax before being moved over to India.Wealth tax is also exempt up to 7 years. Wealth tax exemption is also available on any asset purchased in India from the money he brings back from the foreign country within one year of relocating.

2. After he becomes an Indian resident, he can continue to hold his assets in foreign currency in his RFC (Resident foreign currency account). He can freely spend or invest the amount held in the RFC account anywhere abroad without restrictions.

3. Also, the NRI can continue holding assets (broking account/mutual funds/gold ETFs) abroad and needs no permission to do so after relocating to India. He does not even have to declare that he is holding these assets abroad.

4. However, he will need RBI permission to serve a loan taken when in the foreign country.

5. As long the the NRI maintains the NOR (Not ordinarily resident) status, any income earned from his assets held abroad will not be taxed in India.

6. On NOR status the following rules apply for the NRI moving back:The government confers a special status on people who become residents under the Income Tax Act. If a person has been a non-resident for nine years, he can be an NOR for a year. If a person has been a non-resident for 10 years or more, he can be an NOR for two years. Further, under the Income Tax Act, there is a clause that if he has stayed in India for less than 730 days during the past seven years, he will be given an