Are you a NRI who has moved back to India? As thousands of Non-Resident Indians (NRIs) return to India permanently, financial experts are advising them to take immediate steps to manage their money and investments effectively.These include converting NRE and NRO accounts to resident status and updating KYC details with banks to ensure compliance with RBI rules. Reviewing investments, understanding tax obligations, and arranging health insurance valid in India are also crucial. Updating PAN and Aadhaar documents is recommended to avoid delays in financial transactions.Here are some steps to take as an NRI who has returned back to India:Converting existing accountsFCNR deposits can be maintained until their maturity. After that, they must be converted into either a Resident Rupee account or an RFC account. Similarly, NRE and NRO accounts should be converted to resident savings accounts or RFC deposits once an NRI returns to India permanently. Timely conversion is necessary to comply with RBI rules and avoid penalties, ensuring smooth financial management after the move.Open a resident savings accountIt is important for NRIs who are back in India to open a savings bank account to make everyday banking easier. There are many digital options in the market available for the same.Revisiting investmentsWhen returning to India permanently, NRIs should carefully review their foreign assets, as income from these will now be taxable in India. Diversifying investments into mutual funds, gold ETFs, and bonds is a smart move. It’s also important to update your status with mutual fund houses and brokers, close NRI Portfolio Investment Scheme (PIS) accounts, and open resident Demat accounts. These steps ensure regulatory compliance and simplify investment management in India.Understanding tax rulesReturning NRIs will have either ROR (Resident & Ordinarily Resident) or RNOR (Resident but Not Ordinarily Resident) tax status, according to ET.
- ROR: Worldwide income is taxable in India, and foreign assets must be declared in ITR.
- RNOR: Only Indian income is taxable, foreign income is exempt unless received in India.
Updating insurance coverReturning NRIs should buy comprehensive health insurance for their families as foreign health insurance policies will no longer be valid. They should also consider term life insurance with maximum coverage to protect financial security under Indian regulations.Future planning Converting bank accounts, securing insurance, complying with taxes, and reviewing investments are vital for a smooth financial transition. Experts say that early action will help NRIs avoid penalties and keep finances organised, allowing them to settle comfortably in India.
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