Residents who leave India with the intention of residing abroad for an extended period of time must notify their bank, and the bank will convert their resident bank accounts to foreign currency accounts.
New Delhi: Many students dream of going for higher studies abroad, and many are also able to realise their dreams. But how does one answer the basic questions, like how to manage the savings account they had in India? And is it required for an Indian resident studying abroad to change a bank savings account in India to a non-resident ordinary (NRO) or non-resident external (NRE) account? If you are looking for answers to the above questions, here is the article for you.
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What Happens to Your Bank Account When You Move Abroad?
Residents who leave India with the intention of residing abroad for an extended period of time must notify their bank, and the bank will convert their resident bank accounts to foreign currency accounts. As a result, a student who plans to live abroad for a lengthy period of time must notify the bank in advance, as per the Mint.
What Does Income Tax Act Say?
Your residence status will be determined in accordance with the Income Tax Act in the following manner for each fiscal year: You must meet at least one of the following conditions, as well as two additional conditions, to determine your tax resident status:
First, you must be in India for 182 days or more in the relevant fiscal year, or you must be in India for 60 days or more in the said fiscal year and 365 days or more in the four fiscal years immediately before the relevant fiscal year. In the second condition, the term of 60 days is replaced by 182 days for an Indian citizen or person of Indian descent who lives outside India and visits India during the fiscal year, the report said.
RBI’s Guideline On NRI Joint Accounts
As per the Reserve Bank of India, Banks may incorporate an NRI as a joint account holder with a resident account holder if certain conditions are met. The NRI relative may only use this account for domestic payments and may not create any beneficial interest for himself.
How to Open Student Bank Account Abroad
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Many banks in other countries claim that you can open an account over the phone or online, but you should do so in person. As an international student, you do not fit neatly into any category established by banks abroad, and dealing with any difficulty in person is preferable. Furthermore, if you require additional services, it is usually beneficial to create face-to-face contact with bank workers, as per Shiksha.com.
