Answer Book question
Once you become a resident under FEMA, the NRE account must be redesignated as a resident rupee account (or the balance moved to an RFC account if you want to keep it in foreign currency). Inform the bank promptly. The tax-free status of NRE interest ends with your NRI status.
Once you become a resident under FEMA, the NRE account must be redesignated as a resident rupee account (or the balance moved to an RFC account if you want to keep it in foreign currency). Inform the bank promptly. The tax-free status of NRE interest ends with your NRI status.
A returnee keeps using his NRE account for three years. Interest continues to be paid tax-free. A later review treats it as taxable; penalties follow. The bank should have been told on day one.
NRE accounts exist for non-residents. Residency change means the account type is no longer appropriate. Redesignation is a form at the bank; it does not cost anything, and delay creates exposure.
Date of return with intent to stay Balance and any FDs under NRE RFC option for foreign-currency retention Tax on interest from the date of return
Silence. The bank does not know you have returned unless you tell them.
Most Kerala bank branches process this routinely; bring your passport and a declaration.
NRE savings ₹12 lakh → resident savings. NRE FD ₹20 lakh → allowed to run to maturity in many cases, then resident FD. Interest taxable from return date.
If you are not yet sure you are staying. a trial year. you may remain NRI on a visit. Decide and act accordingly.
Inform the bank in writing Redesignate or convert Tell your CA the date
Can I keep my NRE FD after returning? What happens to my NRO account after I become resident? What is an RFC account?
NRIs & returning Malayalis
RBI FEMA regulations on NRE/NRO/RFC accounts · Income Tax Act residency provisions · SEBI/AMFI rules on NRI investment · NORKA Roots schemes · Kerala Rising is not a tax adviser; residency and tax questions need a CA Rates, limits and whether you may qualify change. Confirm with the official source. Ask Kerala Rising: Tell us your return date, which accounts you hold, and whether you still earn abroad. We will give you the housekeeping list and flag what needs a CA. WhatsApp +1 443 595 9000 · keralarising.com Kerala Rising › NRI · NRI 3
This page is general orientation, not personal insurance, investment, medical, legal, lending, tax, or professional advice. Rules, rates, benefits, and claim or application decisions can change. Confirm the current position with the named official source and use a licensed or qualified professional where your situation requires one. Kerala Rising does not decide whether you may qualify, approve claims, or promise an outcome.