Tool 02 · Banking

NRE / NRO / FCNR — which account do you need?

Your sale proceeds must land in the right account. Wrong account = FEMA violation. This tells you exactly which one and why.

Three quick questions

Where does the money you want to deposit come from?

What do you want to do with this money?

What currency do you want to hold the funds in?

Recommended: NRE Account

Foreign salary or income that you want to move freely between India and abroad is ideal for an NRE account. Interest is tax-free in India, and both principal and interest are fully repatriable without any limit or documentation.

Side-by-side comparison
FeatureNRENROFCNR
Full nameNon-Resident ExternalNon-Resident OrdinaryForeign Currency Non-Resident
CurrencyIndian Rupees (₹)Indian Rupees (₹)Foreign currency (USD, GBP, EUR, AUD, CAD)
Deposit sourceForeign income onlyIndian income + foreign remittancesForeign income only
Property sale proceeds✗ Cannot deposit✓ Must go here first✗ Cannot deposit
Interest tax in India✓ Tax-FREE — Sec 10(4)(ii)✗ Taxable at 30% + cess✓ Tax-FREE — Sec 10(15)(iv)(fa)
RepatriationFully free — no limitUp to USD 1M/yr + Form 145 / 146 + ITRFully free — no limit
Currency riskYes — INR can depreciateYes — INR denominated✓ None — held in foreign currency
Joint holdingWith another NRI onlyWith NRI or resident relativeWith another NRI only
Typical FD rate~6.5–7.5% p.a.~6.5–7.5% p.a. (taxed)~4–5.5% p.a. (foreign currency)
Best forForeign salary, free repatriationProperty sale proceeds, rental incomeAvoiding currency risk on foreign earnings
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Property sale flow: Step 1 — Proceeds land in NRO (mandatory, FEMA). Step 2 — Repatriate via Form 145 / 146 + ITR, up to USD 1M/yr. Step 3 — Funds returning from abroad go to NRE or FCNR.
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We advise on account structuring, TDS reduction on NRO interest, DTAA applications, and FEMA-compliant repatriation.

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