Some choose to close their savings account rather than turn it into one of the NRI banking accounts with more and more people moving abroad.
If he moves abroad for whatever cause, an Indian resident can convert their regular savings account into an NRO account. Through this conversion, the NRI deposits the NRO account from their investments, loans, rent, etc. In the form of the Indian currency, all gets carried out.
Here are the benefits of holding an NRO account
NRO accounts provide many services to NRIs. For depositing and withdrawing money, you can do so either with a current or savings account. Daily deals would see NRO savings account opened by a person with not many transactions. It is because of the money that you get from your savings account. The NRO saving account, where you can obtain a deduction of up to INR 10,000 on the interest earned while filing returns, also provides an additional benefit. For investment purposes, you can vote for NRO recurring or NRO fixed deposit services.
The entire interest earned on behalf of NROs is taxable in the individual's possession. Thus, no portion of the income would be considered tax-free, and any balance would be included in the taxpayer's tax return. Non-residents, however, are not worried, as they can make use of the necessary exemptions for calculation purposes, which is approximately INR 2.5 lakh.
To reap the benefits of various tax provisions, NRO account holders need to ensure that additional work is done. Currently, 30 per cent of the interest earned from the NRO savings account is withdrawn, which is high. There are circumstances under which lower rates apply. However, you need to consult the bank on the same matter. It makes it essential to file tax returns and get refunds for individuals.
How to convert regular savings account to NRO account: