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What Are The Advantages Of Holding An NRO Account?

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 Currently, 30 per cent of the interest earned from the NRO savings account is withdrawn, which is high.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:

  • Notify the bank where you have your savings account that you have moved abroad and opt for an NRO account opening online.
  • Complete the conversion form that includes information about your KYC, new address details, contact point, etc. It can be accessed either from a branch of a bank or on the bank's website.
  • Certify the form until finished. Provide documents such as a visit permit, PIO card, passport copy, etc., with the approved form.

If the savings account is a zero-balance accountHealth Fitness Articles, you would need to change it to a minimum average balance savings account.

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Arjit Chalmela is a finance aspirant who loves writing on the same. He has spent considerable time researching NRO accounts. Through his work, he has listed its benefits

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