NRI / OCI Investment Tool
Permissible investments in India for NRIs and OCIs with tax implications.
The NRI / OCI Investment Tool is a reference guide to the investments that Non-Resident Indians and OCI cardholders are permitted to make in India under FEMA. It covers NRI bank account types, repatriation rules and tax treatment. It is for NRIs, OCIs and their families planning investments or managing funds held in India.
Use the NRI / OCI Investment Tool
Reference guide for Non-Resident Indians (NRIs) on permitted investments in India under FEMA — account types, repatriation rules and tax treatment.
NRI Bank Account Types
| Account | Currency | Source of Funds | Repatriation | Tax Status |
|---|---|---|---|---|
| NRE | INR | Foreign earnings only (remitted from abroad) | Freely repatriable | Interest tax-free in India while the holder is non-resident (Sec 10(4)(ii)) |
| NRO | INR | Indian income (rent, pension, dividends) + foreign funds | USD 1 mn / FY (with CA cert) | Interest taxable; TDS @ 30% plus surcharge and cess (lower DTAA rate with a TRC) |
| FCNR(B) | Foreign (USD, GBP, EUR etc.) | Foreign earnings remitted | Freely repatriable | Interest tax-free in India |
| RFC | Foreign | After returning to India (for returning NRIs) | Freely repatriable | Tax-free if RNOR status |
Permitted Investments for NRIs
| Investment | Permitted? | Conditions / Notes |
|---|---|---|
| Indian listed equity shares | Yes | Via Portfolio Investment Scheme (PIS) account; an individual NRI / OCI may hold up to 5% of a company's paid-up capital; all NRIs / OCIs together up to 10% (the company can raise this to 24% by special resolution) |
| Mutual funds (equity / debt) | Yes | Via NRO / NRE; KYC and FATCA compliance required |
| Indian government bonds / G-Secs | Yes | Including via FPI route or Fully Accessible Route (FAR) |
| Corporate bonds / NCDs | Yes | Subject to issuer-specific FPI limits |
| Residential / commercial property | Yes | No restriction on number; CANNOT buy agricultural land / farmhouse / plantation |
| Agricultural land / farmhouse / plantation | No | Only via inheritance permitted |
| Bank fixed deposits | Yes | NRE FD interest tax-free; NRO FD interest taxable with TDS |
| Public Provident Fund (PPF) | Existing only | NRIs cannot open new PPF; can continue existing account till maturity (no extensions) |
| National Savings Certificate (NSC) | No | Cannot buy new; certificates bought while resident can be held till maturity |
| Senior Citizen Savings Scheme | No | Not available to NRIs for new accounts |
| NPS Tier-I | Yes | NRIs and OCI cardholders aged 18-70 may join (entry age raised from 65 to 70 by PFRDA, August 2021); subject to KYC and FEMA rules on the source of contributions |
| Sovereign Gold Bonds (SGB) | No | Cannot subscribe; bonds bought while resident can be held till redemption. Gold ETFs are an alternative |
| Cryptocurrency / VDA | Caution | Indian exchanges may permit with NRO funds; gains taxed @ 30% with no set-off of losses, and 1% TDS on transfers; high regulatory uncertainty |
| Partnership firm / sole proprietorship | Conditional | Non-repatriable basis allowed, except in firms / concerns engaged in agricultural or plantation activities, real estate business or print media |
Key compliance reminders for NRIs:
- Residential status: Determined under Section 6 (Income Tax Act, 1961) / Section 6 (Income Tax Act, 2025 from TY 2026-27). Generally non-resident if <182 days in India during the year, subject to the 60-day / 120-day rules for Indian citizens and persons of Indian origin.
- Schedule FA: Only residents who are ordinarily resident must disclose foreign assets in Schedule FA of the ITR. NRIs and RNORs do not.
- FEMA residential status: Different from Income Tax. Under FEMA, an NRI is one residing outside India for employment / business / indefinite stay.
- Repatriation from NRO: USD 1 million per financial year (April–March) out of NRO balances / sale proceeds (current income such as rent and dividends is repatriable net of tax outside this limit), with Form 15CA/CB (now Form 145/146 from TY 2026-27). Requires CA certification.
- PAN mandatory: Required for all investment, banking and property transactions.
- Aadhaar: Not mandatory for NRIs.
Important note: This tool provides an indicative output only. It does not factor in every special provision, surcharge, exception, or recent notification. Verify with the firm before acting on any computation.
Frequently Asked Questions
What is the difference between NRE and NRO accounts?
An NRE account holds foreign earnings remitted to India, is freely repatriable, and its interest is tax-free in India. An NRO account holds income earned in India, such as rent, pension or dividends; its interest is taxable with TDS, and repatriation from it is limited to USD 1 million per financial year with the prescribed forms and CA certification.
Can an NRI buy property or agricultural land in India?
An NRI can buy residential and commercial property in India, with no limit on the number of properties. However, an NRI cannot buy agricultural land, a farmhouse or plantation property; these can be acquired only by inheritance. PAN is required for property transactions, and tax on any capital gain must be paid before sale proceeds are repatriated.
How do I use this NRI investment guide?
The guide summarises, in two tables, the NRI bank account types with their repatriation and tax treatment, and the investments NRIs may or may not make in India, such as listed shares, mutual funds, property, PPF, NPS and small savings schemes. It is a general reference under FEMA, so check the specific conditions with your bank before investing.
Due in the next 30 days
FEMAFull compliance calendar → Statutory dates, which can be extended by notification. General information only.