10 October 2016
Dear Sirs, My wife & me have travelled from India to USA on Immigrant Visa in Sept 2016 & we will be getting the Green Card in a months time. We both are Senior Citizens. We have Savings Account & FDs in banks in India. The Banks will be paying Interests from FDs & the income from Interests for both us individually will be within Taxable limits. I would appreciate if you can clarify the following: 1. Banks would not deduct any taxes as we had given Form 15H in April.16. When will the bank consider us as NRI & ask us to convert to NRO account? Indian bank & ICICI Bank (in which we have accounts) have told us before we left that we can change to NRO on our next trip to India. Banks are not particular we should intimate immediately. We could not have given any intimation before leaving because unless we are admitted in USA after we reach USA we are not NRIs. 2. As a NRO account 30.9% is to be deducted from Interest payments. Ofcourse we would get refund of all deductions as our income will be within taxable limit. (We have no other income), How Do I proceed now? We would like to follow the rules to the extent possible. I would appreciate if you can give your clarifications by email also. Subramanian.V (now in USA) vasusubram@yahoo.com
10 October 2016
See, try to remember one thing in nutshell..... you are doing a favour on indian banks....ok? Your hard earned money is kept in Indian Banks...So please dont get panic Banks are obilgated to you and not you...ok? now let us go one by one.... 01. There are 2 distinct Acts viz. Income Tax Act & FEMA......So far as NRE, NRO is concerned, banks have to follow FEMA and not Income Tax...ok? So far as payment of interest is concerned, bank has to follow Income tax and not FEMA.... 02. The definition of Non Resident is different under both of these acts....So always try to talk like NR under FEMA and/or NR under income tax act.....ok? 03. As ICICI and Indian banks have rightly told you, therefore, you can change the normal savings accounts to NRO account on your next trip. You can even do so through net banking as well, if you have so....You can also do so by calling the call centre of these banks.....see which one is convenient for you.. (The underlying principle is that you are NOT doing any legal wrong by NOT informing the banks that you have travelled abroad...ok?) Your views please.
10 October 2016
1, if your intention to stay abroad is considered to convert the resident account to NRO.you can infirm the bank once you get the green card.if NRI then 15 H cannot be given.
2,If PAN number is given bank will deduct @normal rate only not 30%.Surcharge is applicable along with tax
10 October 2016
1 Once you become NRI you have to change the account to NRO. You can change the account to NRO after 182 days, by intimation and filling forms online. 2 Once you become NRI you are not eligible to furnish form 15H. You can file return and get refund on TDS deducted or make an application u/s 195(3) to your jurisdictional AO to obtain a certificate of non deduction or lower deduction of tax. This you can do it in next visit or tax consultants can do it for you.
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