NRE- Non Resident External account
NRE account is a bank account that's opened for depositing foreign currency. Interest earned on the NRE account is totally exempted from income tax and nor TDS is deducted on it.
NRO- Non Resident Ordinary acccount
NRO account is a bank account opened by an indian going abroad with the intention of becoming an NRIs.
The interest earned on NRO Account as well as the credit balances in account are taxed under the account holder’s tax bracket in India. The Bank will deduct 30% TDS on interest Income which an NRI can file its return & Claim Refund if he is falling within Basic exemption limit.
Both NRE and NRO Account can be jointly opened. In case of NRE in name of two or more Non Residence. However in case of NRO it May be held jointly with residents also.
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