Sending Money to India vs Taking Money Abroad:
For Non-Resident Indians (NRIs), moving money between countries is a common part of life. Whether you’re sending funds home to support your family or planning to take money abroad after selling property, the rules can get confusing.
Understanding the difference between inward and outward remittance helps you stay compliant and avoid costly mistakes.
Table of Contents
Why It Matters for NRIs and HNIs
Moving money across borders isn’t just about convenience—it involves RBI regulations, tax rules, and documentation.
Getting it right ensures smooth transfers, better financial planning, and peace of mind.
Part 1: Sending Money to India
✅ Allowed for All NRIs
As an NRI, you can freely send money to India using banking channels like:
- SWIFT wire transfer
- Online remittance services (Wise, Remitly, Western Union)
- NRI accounts like NRE and NRO
✅ Use NRE Account for Repatriable Funds
Funds sent from abroad to an NRE account are fully repatriable and tax-free in India.
Example: Raj, living in Dubai, sends AED 50,000 to his NRE account in Mumbai. He can later invest that money or take it back abroad without tax.
✅ Use NRO Account for Local Indian Income
NRO accounts are for managing income earned in India like rent, pension, or dividends.
These accounts are not fully repatriable, and transfers from NRO to abroad are limited to $1 million per financial year.
Documentation Isn’t Too Heavy
To send money to India, most platforms need basic KYC and source-of-funds declaration.
Use regulated services for safety and better exchange rates.
Part 2: Taking Money Out of India
Known as Repatriation
Taking money from India to your resident country is called repatriation.
It’s allowed—but subject to specific rules, especially when funds come from Indian income or asset sales.
✅ From NRE Account
You can transfer any amount from an NRE account abroad without restrictions.
Tip: Use this account for savings from foreign income to avoid tax complications.
✅ From NRO Account
Transfers from an NRO account are capped at $1 million per financial year (after taxes).
You’ll need:
- Form 15CA (filed online)
- Form 15CB (issued by a Chartered Accountant)
- Proof of tax payment
Example: Ankit sold a flat in Pune and deposited ₹60 lakhs in his NRO account. To take it to Canada, he consulted a CA, paid capital gains tax, and completed the forms—ensuring a smooth transfer.
Real-World Tip
Start documentation early. Tax delays and missing forms are the most common reasons for repatriation issues.
Key Differences at a Glance
| Feature | Sending to India | Taking Abroad from India |
|---|---|---|
| Who Can Send | NRI or Foreign Resident | NRI or Returning Resident |
| Account Used | NRE/NRO | NRO/NRE |
| Limit | No limit | $1 million/year (NRO) |
| Tax | NRE – None, NRO – Yes | Post-tax only |
| Forms Needed | Minimal | Form 15CA/15CB (for NRO) |
Common Mistakes NRIs Should Avoid
🚫 Using Resident Accounts
Never use a regular Indian savings account for remittance—use NRE or NRO accounts only.
🚫 Ignoring Tax Filing
If you’re taking money out of India, unpaid taxes can hold up your transfer.
🚫 Not Informing Bank
Let your bank know the purpose of your remittance. Incorrect coding may cause delays or rejection.
Smart Tips for Smooth Transfers
- Keep copies of all property sale documents if transferring proceeds abroad
- Consult a CA for repatriation from NRO accounts
- Use NRE account for clean foreign fund flow
- Always declare gifts or loans clearly when moving money internationally
Frequently Asked Questions (FAQs)
1. How much money can an NRI send to India from abroad?
There is no upper limit for inward remittances to India through legal banking channels. These are freely allowed under FEMA and not taxed in India if sent from income earned abroad.
2. Is there a limit on how much money an NRI can repatriate from India to abroad?
Yes, NRIs can repatriate up to USD 1 million per financial year from their NRO account, subject to tax compliance and proper documentation. There is no limit on repatriation from NRE and FCNR accounts.
3. Are remittances to India taxable?
No, money sent to India from an NRI’s foreign income is not taxable in India. However, if the sender is an Indian resident, TCS (Tax Collected at Source) may apply under the LRS scheme.
4. Can funds be freely moved between NRE and NRO accounts?
Funds can be transferred from NRE to NRO freely. However, transfers from NRO to NRE are subject to documentation, taxes, and RBI rules—mostly for repatriation purposes.
5. Which is the best account for sending and withdrawing money—NRE or NRO?
Use an NRE account for sending money to India—it’s tax-free and fully repatriable. Use an NRO account to manage Indian income like rent or dividends—tax applies and repatriation is limited.
Related Posts You May Like
👉 How to Repatriate Funds from India: Step-by-Step NRI Guide
Understand the process, limits, and documents required to move money abroad legally.
👉 NRE vs NRO Account: Key Differences Every NRI Should Know
Compare the features, taxation, and repatriation rules of both account types.
👉 Best Ways to Send Money to India: A Guide for NRIs
Discover secure, fast, and cost-effective remittance options to India.
Final Thoughts
Sending money to India is simple, but taking money out requires planning. As an NRI or HNI, knowing the rules can help you optimize your global wealth strategy and avoid legal or tax trouble.
When in doubt, talk to a financial expert or NRI-specialized CA—because cross-border wealth deserves clarity and confidence.