Foreign Payments

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ca shaival shah (Querist)
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27 April 2016 I am entered in to agreement with Congo company for Working in Congo As per theie requirement They give me remuneration as 3500 $ per month in my Indian saving account. does it taxable .I am nri

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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28 April 2016 It is not taxable as you are a NRI. Credit to Indian saving ac will not attract tax. Keep the ac as NRO/NRE ac.

ca shaival shah

ca shaival shah (Querist)
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28 April 2016 what's is different between NRo and NRE ?

Aashok Kumar Sharma

Aashok Kumar Sharma (Expert)
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25 July 2024 NRIs (Non-Resident Indians) have two main types of bank accounts they can maintain in India: NRE (Non-Resident External) and NRO (Non-Resident Ordinary). Here’s a breakdown of the key differences between NRE and NRO accounts:

### NRE (Non-Resident External) Account

1. **Purpose:**
- NRE accounts are meant for NRIs to park their foreign earnings remitted to India. Funds in NRE accounts are freely repatriable (both principal and interest).

2. **Currency:**
- NRE accounts are denominated in Indian Rupees (INR), but the funds are held in foreign currency (USD, GBP, EUR, etc.).

3. **Source of Funds:**
- Funds deposited into NRE accounts should come from abroad, i.e., they should be in the form of foreign currency remitted from the NRI's overseas bank account.

4. **Taxation:**
- Interest earned on NRE account balances is tax-free in India. Both the principal and the interest are freely repatriable, meaning they can be transferred back to the NRI's foreign account without any restrictions.

5. **Permissible Credits:**
- Only certain types of credits are allowed into NRE accounts, such as remittances from abroad, interest earned on the funds in the NRE account, etc.

### NRO (Non-Resident Ordinary) Account

1. **Purpose:**
- NRO accounts are used to manage income earned in India (like rent, dividends, etc.) by NRIs. It is also used to manage income earned by NRIs in India, such as rent, dividends, etc.

2. **Currency:**
held NRO accounts are interest can conditions interest that are NRO accounts The foreign income earned by foreign remittances income in the interest on the deposits made in the form

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