Advantages

Today, NRI's from all over the world are playing a major role in uplifting the Indian Economy. Infact NRI investment have shot up from 20% last year to 28% for the year 1996-97. In 28% share of the investment in almost all the Industry's, a major share of 9% investment is devoted to the real estate industry. During the real estate boom, NRI's were reported to have pumped in a whopping $1 Billion into the real estate market. The housing loan limit for NRI's have also been liked from Rs.10 lakhs to Rs.25 lakhs by HDFC. There will be an unprecedented flow of surplus funds entering the real estate market in the year 1997-98.

The following are the advantages if you are an NRI:

• All investments made by NRI's in the form of NRE accounts (Saving A/c, Fixed deposits) does not invite any tax.

• All NRI's can give gifts without paying the gift tax from his / her NRE account to a close relative or a friend.

• NRI's can also make investments in NR(NR) accounts (Non Resident non repatriable) accounts without paying any income tax, and also give gifts once in a life time out of these funds without paying any gifts tax.

• Interests earned on NR (NR) accounts can be repatriated or invested in NRE accounts.

• The NRI's cannot be questioned regarding their income abroad.

• No wealth tax on funds accumulated abroad.

• Preferential treatment in the allotment of public issues of limited companies.

• Preferential treatment in the allotment of non-agricultural land, houses, sites etc. by the government authorities.

• Preferential treatment in getting admissions to Medical, Engineering and other educational institutions.

• NRI's can float offshore companies in tax havens like Mauritius etc. and avail the benefits arising out of double tax treaties existing between India and other tax havens.

• Under the income tax act 1961, investment income are taxed at a lower rate of tax, an option exercised for NRI's only.

• Any NRI having only an investment income or long term capital gain need not file return of income under the income tax act 1961.

• Investments available on repatriation/non repatriation basis.

• NRI's are permitted to establish school and colleges all over India.