NRI Account

[RatanR]

Do I get tax benefits if I have an NRI account?

[peace999]

there are mainly 3 types of NRI accounts;


NRO , NRE ,FCNR.

NRO and NRE are Indian rupee accounts

NRO the interest ( savings or FD) is taxable (TDS) at higher rate ( 30%) than Indian resident (TDS 10%).
that 30% tds can be reduced if you present a tax residency certificate of foreign country if there is a double taxation treaty with that country.

NRE ( indian rupee account) and FCNR( Foreign currency account) ; principal and interest are tax free in India but if you are in a country like US or canada , you will have to report this interest income to them and they will tax it .

So, depending on your country , it may be beneficial to keep money in NRE or FCNR if your tax rates are lower for foreign income from India.
Also keep in mind that Indian rupee is vulnerable to depreciation so any benefit you derive from tax free in NRE , it can be nullified by INR depreciating.

FCNR may be the best choice as it is tax free and kept in your currency . But interest rates are much lower than NRE but surely better than in US or canada.