What Defines Me as an NRI? Your residency status isn't determined by which passport you hold—it's all about how many days you spend in India. This legal distinction forms the foundation for all banking and tax rules that will apply to you going forward. Income Tax Act Definition You become an NRI if you're in India for less than 182 days in a financial year, or less than 60 days during the year while having spent less than 365 days total in the preceding four years. FEMA Definition For Foreign Exchange Management Act purposes, the rule is simpler: staying abroad for more than 182 days in a calendar year automatically classifies you as an NRI. Understanding these thresholds is critical—your residency status triggers specific compliance requirements for your financial life in India. What Happens to My Bank Accounts? Once you become an NRI, you cannot continue operating regular resident savings accounts. The law requires you to re-designate them, and it's your responsibility to inform your bank with proper documentation. NRE Account Non-Resident External Holds foreign earnings in Indian rupees Fully repatriable—no restrictions on transferring funds abroad Tax-free interest income Joint account only with another NRI NRO Account Non-Resident Ordinary Manages Indian income like rent, dividends, and pension Subject to repatriation limits (up to USD 1 million per year) Taxable interest income Can have joint account with residents Failure to convert accounts can lead to penalties and freezing of funds. Provide proof of NRI status—like visa copy and employment letter—to your bank promptly. Can I Keep My Investments? The good news: most of your existing investments can continue running. However, you'll need to update your status and understand new limitations on what you can start fresh. Public Provident Fund (PPF) Your existing PPF account can continue until maturity, but you cannot open a new PPF or extend it beyond the standard 15-year term once you're an NRI. Mutual Funds You can hold existing funds and continue SIPs, but you must update your KYC status to 'NRI' with each fund house. New investments require proper documentation. Equity Investments All stock market transactions must be routed through a Portfolio Investment Scheme (PIS) account, which you'll need to open with your designated bank branch. Restricted Schemes Certain schemes like Senior Citizens Savings Scheme (SCSS), Kisan Vikas Patra, and post office savings cannot be initiated after acquiring NRI status. How Am I Taxed Now? Your tax liability undergoes a fundamental shift once you become an NRI. You're only taxed on income that is earned or accrues within India—your foreign salary and overseas income remain outside India's tax net. Indian Salary Taxable only for services rendered in India Rental Income Fully taxable with standard deductions Capital Gains Taxable on sale of Indian assets and property NRO Interest Interest from NRO deposits is taxable in India Not Taxable in India Foreign salary and wages Overseas business income Global investment returns You must file an Indian tax return if your Indian-sourced income exceeds the basic exemption limit, even if you're living abroad full-time. Sending Money to India: Your Options Transferring funds to India as an NRI is straightforward—but it must be done through legal, documented channels to ensure compliance with FEMA regulations. Wire Transfer to Your Own Accounts Send money to your NRE or NRO accounts via international wire transfer (SWIFT) directly from your overseas bank account. Remittance for Family Maintenance You can freely remit funds to resident relatives in India for their maintenance, education, medical expenses, or other family needs. Keep All Documentation Retain transfer receipts, FIRC (Foreign Inward Remittance Certificate), and bank statements for future compliance and repatriation proof. Critical warning: Using informal channels like hawala or unregulated money transfer services violates FEMA regulations and can result in severe penalties, asset seizure, and legal prosecution.