A banking guide for NRIs and applicability of 15CA/CB on transfer from NRO A/c to NRE A/c

Updated: May 16

Non-resident Indians do generally hold Indian accounts in form of Non-resident ordinary A/c (NRO) and Non-resident External A/c (NRE) in India.

As the name suggests, these accounts are exclusive to NRIs, there is a basic difference in their usage.




Features of NRO & NRE A/c:

An NRO A/c is used by NRIs to receive their Indian income i.e., incomes which are sourced or earned in India are received in the NRO A/c and on the other hand, NRE A/c is used by NRIs to park their foreign earnings in India for some very known reasons, Indian FDs yield a higher interest and Indian investments are very lucrative as their return prospects are quite high compared to those in abroad.

So, to summarize, NRO A/c is for Indian incomes and NRE A/c is for foreign incomes which are brought to India for investment purposes.


Taxation of incomes received in NRO & NRE A/c:


As we have understood the basic characteristics of these two accounts, let us jump on to the taxations of the income earned thru these accounts.

NRO A/c:

As this a/c is for receiving Indian incomes and as per the Indian tax law, all incomes earned or received (foreign income) in India are taxable in India. Therefore, all income accruing to NRO A/c are taxable in India.


NRE A/c:

As this A/c is for parking foreign incomes in India, the government wants to incentivize those who bring in foreign currency and therefore, Interest accruing to the credit of an NRE Savings & FD A/c is tax exempt. But if the amount standing to the credit of this account is invested further into purchase of capital assets like property, land, shares, mutual funds etc. then the gain arising on transfer of these assets will be taxable in the year of transfer.


Whether an NRI is liable to file his return of income in India?



This is a question which we hear a lot from our NRI clients. An NRI is only liable to file his return of income in India if his/her income exceeds INR 2,50,000/-

Even if the income is below the above limit and tax has been deducted at source on Indian incomes by payers in India, we advise our clients and others as well to consult their tax consultants to identify whether they are actually liable to pay tax, as DTAA benefits can be claimed and the tax deducted at source may be refundable.


All NRIs might have heard about these forms from their banker whenever they plan to make remittance from India to their resident country.

But there is still not of clarity as to an NRI transfers funds from his/her NRO A/c to NRE A/c, and even from self-account transfer, the banks insist on certifying the transaction from a practicing Chartered accountant as to its taxability and compliance with withholding tax rules.

As per law, since the transfer is by a Non-resident to himself and there is no another person, the 15CA & CB are not required to be submitted and the banks should facilitate the transaction without these forms, but due to rigorous audits and to keep a check on money laundering, the banks insist on getting these certificates to be in a safe zone.

Hence, NRIs should get their form 15CA and 15CB for facilitating a smooth remittance.

A. 15CA is a self-declaration form and is to be verified by the NRI on the income tax portal using any of the following methods:

1. Aadhar OTP

2. Thru Net banking (provided you bank supports tax account verification)

3. Thru bank account – (provided the bank details have been uploaded on the tax account and validated – generally takes around 15 days to validate the bank account)

4. Thru Demat account- (provided the account details have been uploaded on the tax account)

5. Thru an Authorized signatory appointed on the tax portal (A power of attorney needs to be signed by the parties and submitted for verification)


B. 15CB is the certificate of an accountant (CA) who will examine the source and genuineness of the funds.



Thank you readers for your valuable time in reading this article.


In case you are seeking help in transferring funds from India, we would be fortunate to assist you in this. Please contact us here.

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