Can I convert the Resident Demat Account to NRI Demat Account? (2024)

FAQs

Can I convert the Resident Demat Account to NRI Demat Account? ›

A resident demat account can be converted into an NRO demat account as long as you have an NRO Saving Bank Account. A resident trading account cannot be converted into an NRI trading account. An NRI customer has to close the resident trading account and open a new NRI trading account.

No. NRIs are not allowed to open or operate a resident savings account. If they are found to be doing so, they may have to pay a penalty of up to three times the amount in their savings account or ₹2 lakhs (if the amount is not quantifiable). Are NRIs allowed to invest in India?

In case you fail to convert your resident savings account to an NRO account there are penalties involved, including: A fine of up to three times the amount in your bank account; or. A fine of ₹2 lakh if the amount is not quantifiable.

Yes, Non-Resident Indians (NRIs) are allowed to open demat accounts in India. The Reserve Bank of India (RBI) permits NRIs to invest in the Indian stock market through the Portfolio Investment Scheme (PIS) route.

Account Opening Form Copy of PAN Card Passport size photographs Copy of Passport (along with VISA page & ADDRESS page) Copy of OCI (Overseas Citizenship of India) Card / PIO (Person of Indian Origin) Card Copy of FOREIGN ADDRESS Proof Overseas Address Proof Copy of INDIAN ADDRESS Proof 1 Cancelled CHEQUE of the NRI ( ...

Once you become an NRI and plan to continue investing in India, you will have to close your existing resident demat account and open a new NRI demat account under PINS. You need to open separate demat accounts for repatriable and non-repatriable investments.

As per the regulations set forth by the Foreign Exchange Management Act or FEMA, if you move out of India, you cannot have any resident accounts. Whether you shift due to employment or further education, the rules still apply. In such cases, your demat account status must change to that of NRO.

In case you simultaneously hold a non-resident account and resident account and your status is that of non-resident Indian, you need to convert your resident account to NRO. This is in line with the applicable FEMA guidelines.

Currency Difference

Due to the conversion of currency in the NRE account, you make a loss on the change in the currency value of the currency you deposit and convert into INR. But in the NRO account, there is no such risk since there is no conversion of currency.

Can I have both resident and NRI account? ›

Technically an individual cannot hold both the status i.e. resident and non-resident at the same time. If the individual is an NRI, he needs to close the resident saving account and open NRI account. If the individual is a resident Indian, then he needs to close the NRI account and open a normal saving account.

An NRI, at any point in time, can hold multiple demat accounts under their name. In fact, if you're a regular investor, you can choose to open all the above three NRI demat accounts - one for repatriable investments, another for non-repatriable investments, and a third for investing in the secondary market.

Zerodha and Prostocks are the two best NRI discount brokers in India. Prostock is the low-cost NRI trading broker that charges Rs. 100 flat brokerage on NRI trading while Zerodha charges Max Rs. 200 per order brokerage.

NRIs, who hold a valid Indian passport or Overseas Citizenship of India (OCI) card, are eligible to open a Demat account. NRIs can hold both repatriable (NRE) and non-repatriable (NRO) Demat accounts, depending on their investment objectives.

Taxation Processes in Place for NRE and NRO Demat Accounts:

Taxability applicable to NRO Demat accounts is no different from that of NRE Demat accounts. That being said, income derived from an interest in an NRE account is exempt from being taxed in India provided the account holder is of course an NRI.

NRI Demat accounts are Demat accounts for non-resident Indians. Whereas customers who live in India can open a regular or normal Demat account. An NRI Demat account is required by the Foreign Exchange Management (FEMA) for non-resident Indians.

Under the Act, any individual who fails to adhere to the guidelines is liable to pay a penalty of up to 3 times the amount involved in the existing resident savings account or Rs 2 lakh when the sum is not quantifiable.

Though most NRIs continue with their resident savings account in India, it is against the law. This means that it is "illegal" to hold a resident savings account after getting an NRI status.

An NRI, at any point in time, can hold multiple demat accounts under their name. In fact, if you're a regular investor, you can choose to open all the above three NRI demat accounts - one for repatriable investments, another for non-repatriable investments, and a third for investing in the secondary market.