Operating/Opening NRI accounts while waiting for OCI

[kcpant]

State Bank of India's web site says that they cannot open NRI accounts at their US branches. Does this mean that while the US branches may accept applications, all processing and account maintenance happens in India?.

This could probably be true. Its is not a true bank in US sense.

 

[akgarg]

This could probably be true. Its is not a true bank in US sense.

Yes, everything related to NRE/NRO accounts is maintained/transacted in India only. For Citibank, I sent my application and initial remittance check to their rep in California, but the checkbooks, ATM cards, PIN #s and email communications (monthly statements, etc.) all came directly from Chennai - via DHL air delivery.

 

[Rama Bashyam]

If the annual interest is above Rs 20k, they can (read:will) deduct 30%. This is true for an type of account irrespective of our IT status.

I don't think that is the case from my experience. My interest was only a few hundred rupees and still they deducted taxes from it. I did not have other banks deduct taxes for the interest.

 

[akgarg]

Akgarg thanks for the info. I have two more questions:

1. Do they send something similar to 1099 (for NRE/NRO Accounts) for filing US tax returns?

2. Should we pay Indian Tax for the interest on those accounts?

Thanks,

I opened these accounts in March 08, so don't have to deal with the tax issues until early 2009 .

Most likely, I'll report the all the interest earned on our US return and if any amount is deducted by Citibank for Indian taxes, claim that as foreign tax credit. I'll update the info on this forum when the time comes.

I don't think Citibank India will issue a 1099 for this interest.

 

[ginnu]

Do all Indian banks directly deduct income-tax on interest from the account? Or is it just Citibank that does this?
--only citibank
I am referring to NRI/NRE/NRO etc. accounts.
----------------
Thanks.

Citi bank is American bank that has branches in India. The interest you earn they send you what you earned and you need to report that interest to IRS. If you open account with ICICI or HDFC or any Indian bank then the Interest you earn is not reported to IRS and interest on NRE A/C you earn you don’t have to pay tax to Indian government

 

[ginnu]

Akgarg thanks for the info. I have two more questions:

1. Do they send something similar to 1099 (for NRE/NRO Accounts) for filing US tax returns?
---------------only Citibank sends as the bank is not indian bank. ICICI, HDFC, AXIS dont send and for NRE A/C Intrest no tax is paid in India
2. Should we pay Indian Tax for the interest on those accounts?
------------------not on NRE A/C but on NRO (non Resident Ordinary) bank can deduct 30% intrest . you can write email to ICICI, HDFC and can find out the full details
Thanks,

-----------------

 

[ginnu]

Can we deposit the ordinary PPF (opened long time ago) in NRO or NRE account?

-NRO

if you have any old active saving account that you never updated that you are NRI then deposit in that account. nobody cares if you are NRI and no bank ask for your passport or GC or Citizenship if you dont inform. Many NRI have old saving account and they deposit in that account so that bank dont cut 30% intrest. only from NRO A/C they cut 30% intrest

According to FEMA and RBI rules, NRI can’t buy agricultural land but I know about few NRI who bought the agricultural land and got registered before sub-registrar.Sub- Registrar doesn’t ask if you are NRI and they don’t ask for your passport. In India if you try to be honest then you are out of the Indian system if you bribe anything is possible and you are in the system.
** if you have PAN card that is ok for many Transactions and it is also an ID. FYI NRI can also get PAN card and any child can also get Pan card.