Are funds remitted back to self considered as "accumulated savings" for source of investments?

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This discussion clarifies whether funds remitted back to India from overseas earnings can be considered 'accumulated savings' for investment purposes. The consensus is yes, provided you can demonstrate the funds are legitimately yours. Supporting documentation, such as remittance transaction details showing sender and receiver information, will be crucial for IT compliance verification.

Ngr

Ngr (Querist)
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30 October 2021 For fiscal year 2020, I qualify as NRI for tax purposes. I have returned now to India. I worked abroad during 2020 and remitted back my foreign savings in rupees to my own Indian account. Using these remittances as source, I invested in many mutual funds in India through the fiscal year.
For 2020, I have no taxable income in India but to explain the 'source of funds' for my mutual fund investments on the IT Compliance e verification portal, can I select "Out of earlier income or savings" as the appropriate response?
- If yes, what supporting documents should I have available?
- If no, what other response option can I select for "Source of Investments and Taxable Income" category?

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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30 October 2021 Yes, it can be appropriate response.
Your bank transfer from foreign salary income.

Ngr

Ngr (Querist)
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30 October 2021 Dhirajlalji, thank you so much for your prompt response. For bank transfer documentation, if I show my Indian account statement (for 2020) with remittances received from abroad, will that be the correct document proof?

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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30 October 2021 Just 'remittances from abroad' will not help; unless you justify it that it is your money, transferred through your own account.

Ngr

Ngr (Querist)
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30 October 2021 Ok, thank you. I will then download the remittance transaction details that shows the sender and receiver information for each remittance on the remittance service provider site.

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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30 October 2021 Yes, just keep them ready for reply to any query that may get raised from ITD.

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