Eligibility of NRO Tax Saving Scheme

• NRI/PIO/OCI customers, having Income Tax Permanent Account Number (PAN)
• Minors are not eligible to open account in their single name, however, they can be second account holder along with an adult as primary account holder.

Permissible Credits

• Transfer from NRO / NRE Savings Bank account
• Fresh remittance from abroad through banking channel
• Personal cheques drawn on foreign account
• Proceeds of Foreign Currency Notes / Travelers cheques tendered, while visiting India. Amounts in excess of USD 5000 (or equivalent) in currency or USD 10,000/- (or equivalent) in Travelers cheques should be accompanied by a Currency Declaration Form (funds will be converted into NRO funds)

Term Deposits (TDR)

• Rupee deposits of fixed tenure
• Interest is paid quarterly on Term Deposit Receipts (TDRs). It will be credited to the NRO Savings Bank / Current account as per request of the customer.
• Minimum Deposit: Rs. 10,000/- & in multiples of 1,000s.
• Maximum Deposit: Rs. 150,000/- per Financial Year.
• Principal & interest amount are repatriable, subject to overall ceiling of USD 1 million or equivalent in a financial year
• Nomination facility available
• On maturity the deposit will be credited back to NRO a/c or renewed into 5 years regular NRO fixed deposit product.

Special Term Deposits (STDR)

• Rupee deposits of fixed tenure
• Interest gets compounded every quarter. It is paid on maturity with the Principal.
• Minimum Deposit: Rs. 10,000/- & in multiples of 1,000s.
• Maximum Deposit: Rs. 150,000/- per Financial Year.
• Principal & interest amount are repatriable, subject to overall ceiling of USD 1 million or equivalent in a financial year
• Nomination facility available
• On maturity, the principle and interest will be credited to NRO a/c or renewed into 5 years regular NRO fixed deposit product.

Tax Implications

Income Tax as per following will be deducted at source on interest earned in the NRO accounts:

• If interest income is less than or equal to Rs. 1 crore: 30.90%
• If interest income is more than Rs. 1 crore: 34.608%

TDS on NRO deposits will be deducted on maturity or on accrual basis annually, whichever occurs first.

In case, depositor is resident of any of those countries with whom India has entered DTAA (Double Taxation Avoidance Agreement), the tax will be deducted as per DTAA agreed between India and the respective country. Please click here for list of DTAA countries and corresponding TDS rates. DTAA benefit can be availed by submitting following three documents:

• 1. Tax Residency Certificate issued by the revenue authorities of your home country
• 2. Self-declaration (please click here to download the standard format)
• 3. Form No. 10F (please click here to download the standard format)

Joint Account With Residents

NRI/PIO/OCI customers are permitted to open and maintain their NRO accounts with their resident relative(s) (as mentioned below) as a joint holder on “Former or Survivor” basis (NRI/PIO/OCI being the former);

• (i) they are members of a Hindu Undivided Family;
• (ii) they are husband and wife; or
• (iii) one person is related to the other in such manner as may be prescribed;
  • 1) Father (Provided that the term “Father” includes step-father)
  • 2) Mother (Provided that the term “Mother” includes step-mother)
  • 3) Son (Provided that the term “Son” includes step-son)
  • 4) Son’s wife
  • 5) Daughter
  • 6) Daughter’s husband
  • 7) Brother (Provided that the term “Brother” includes step-brother)
  • 8) Sister (Provided that the term “Sister” includes step-sister