Unsecured loan from nri
This query is : Resolved
06 October 2018
Can individual take unsecured loan from NRI without interest? And same amount is invested by individual in India then amount is charged for tax? In who's hands?
Is this amount shown as Gift from NRI friend , then amount will be tax??
Is there any option for this?
Please guide...me
Is this amount shown as Gift from NRI friend , then amount will be tax??
Is there any option for this?
Please guide...me
06 October 2018
Resident of India can only borrow money in Indian rupees from NRIs. The conditions under which he/she can borrow are:
Borrowing shall be only on a non-repatriation basis. This means that funds once given cannot be taken back.
The loan can be received only in two ways. The first way is to debit the NRE/NRO/FCNR account of the NRI and give the loan to the Indian resident. The second way is by inward remittance from outside India.
The loan cannot be given for more than three years.
The rate of interest on such loan is fixed. The rate of interest should not be more than two percent above the Bank Rate prevailing on the day of giving of loan.
The repayment of the principal amount and the interest can be done only to the NRO account of the NRI.
In case of gift it will be taxable in the hands of receipient.
Borrowing shall be only on a non-repatriation basis. This means that funds once given cannot be taken back.
The loan can be received only in two ways. The first way is to debit the NRE/NRO/FCNR account of the NRI and give the loan to the Indian resident. The second way is by inward remittance from outside India.
The loan cannot be given for more than three years.
The rate of interest on such loan is fixed. The rate of interest should not be more than two percent above the Bank Rate prevailing on the day of giving of loan.
The repayment of the principal amount and the interest can be done only to the NRO account of the NRI.
In case of gift it will be taxable in the hands of receipient.
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