What are the FEMA Rules for NRI Accounts?

GM Posted by: Gaurav Mishra
• 05 September, 2025
4 Reply

Here are some of the FEMA rules for NRI given below: 
 

  • Repatriation and Remittance rules: An NRI must know the rules for repatriation and remittance for the income earned in India. NRIs need to be aware of the process of remittance of funds and the use of FCNR and NRE accounts. For the repatriation sale of real estate, an NRI is allowed only 1 million USD in a financial year for property purchase under foreign exchange regulations. 
     
  • NRIs are allowed to invest in Indian real estate. It is allowed by the Foreign Exchange Management Act to invest in Indian stocks, bonds, and financial markets. However, there is one condition, that all the investments are made through the Authorized channels with the Portfolio Investment Scheme (PIS). Additionally, NRIs are not allowed to buy any agricultural land in India. 
     
  • Taxation and reporting obligations: NRI under the FEMA rules can do foreign exchange transactions in respect to the Indian laws of taxation. However, they need to report the investments and income in India to the Income Tax department, and pay taxes on the basis of their source of Income. 
     
  • Foreign exchange transactions and bank accounts: According to the FEMA rules for an NRI. They can open 3 types of bank accounts in India, which are Non-resident external (NRE) account, Non-resident Ordinary (NRO) account, and Foreign currency non-resident (FCNR) account. An NRE account allows smooth repatriation of funds, NRO account helps NRIs to manage income generated in India. 
     
  • Gifts and Inheritance:  According to the Foreign Exchange Management Act, NRIs can only get gifts and inheritance from relatives in India, with respect to the guidelines by the FEMA. An NRI can get a gift in the form of property and currency. 
     
  • Power of Attorney for Property Management and Ownership: According to the FEMA rules, the power of Attorney must respect the laws of India, and it should be properly registered and notarized in India. 

Tags : FEMA Rules for NRI Account

  • Bhavin Desai 16 September, 2025

    Can Someone Provide Me With the FEMA rules for Outward and Inward Remittance for NRI?

    • NB
      Nikita Banerjee 18 September, 2025

      Here are the FEMA rules for the outward and inward remittance rules under the FEMA Act. 

      Outward Remittance: This refers to the transfer of money from India to another country, but it is subject to rules and under the RBI's Liberalized Remittance Scheme (LRS) and FEMA. The FEMA guidelines for the Outward remittance are given below: 

      • Allowed purposes like medical expenses, education, family maintenance board, and investments. 
      • Remittances such as margin trading, lottery winnings, and investments are not allowed. 
      • You need to fill out forms A2 and PAN details, which are required by banks for doing outward remittances. 
      • Tax collected at source (TDS) depends on the remittance amount. 

      Inward Remittance: This refers to the transfer of funds from a foreign country to India by the NRIs, persons of Indian origin, and foreign nationals in accordance with the RBI and FEMA guidelines. The FEMA rules for Inward Remittance are: 

      • The funds can be deposited into an NRO, FCNR, or NRE account based on the source of Income. 
      • There is no repatriation allowed on the NRO account. However, Repatriation is allowed on the NRE and FCNR accounts. 
      • All the Inward remittances, like investments, business, and personal purposes, go through authorized banks. 
      • For the process of inward remittance, banks can ask for KYC documents, declarations, and purpose codes. 

       

  • George Cameron 09 September, 2025

    FEMA full form is Foreign Exchange Management Act, and this act is an important part of regulating transaction exchange and the proper execution of the guidelines by NRI on financial dealings, property management, and investments in India. The FEMA Act helps NRIs to transact related to Indian currency and assets with respect to all financial and legal institutions.

  • Ayush Patel 09 September, 2025

    Given below are some of the FEMA rules for financial compliance: 
     

    • If you get an NRI status, then you will need an NRI-specific account, which is a Non-Residential External (NRE) account, Non-resident ordinary (NRO) account, and Foreign Currency Non-Resident (FCNR) account. 
       
    • NRIs have various investment options, like as equities, mutual funds, and corporate bonds, with some limitations. 
       
    • An NRI can invest in commercial or residential property. However, they are not allowed to purchase any agricultural and plantation land in India. 
       
    • If an NRI wants to send money from India or outside India, then they need to follow the remittance limits, which are of USD 1 million in a single financial year for repatriation. 
       
    • For the student who is planning to study abroad and falls under the NRI category, he or she can get remittance up to USD 10 lakh in a year for educational purposes. 

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