NRE vs NRO Decision Tool
Answer three quick questions and get a personalised routing table for every income source you have — with tax treatment and repatriability spelled out.
Your situation
Routing table
| Income | Route to | Tax treatment | Repatriation |
|---|---|---|---|
| Foreign salary → India | NRE | Interest tax-free in India (0%) | Freely repatriable, principal + interest |
Action steps
- 1Open both an NRE and an NRO account with an Indian bank — most banks bundle them. Do NOT keep money in your old resident savings account once your NRI status begins; it must be re-designated as NRO.
- 2For NRO repatriation above trivial amounts, plan the CA-issued Form 15CA/CB paperwork ahead of the transfer. USD 1 million per financial year cap applies from NRO balances.
- 3File your Indian ITR every year (ITR-2 for most NRIs). Even if TDS covers your tax, filing lets you claim excess back — TDS on NRO interest is 30%+, but effective slab rate is often lower.
Which account should you use?
NRE (Non-Resident External) accounts hold your foreign-earned money in INR. Interest is tax-free in India, principal and interest are freely repatriable, and it's the right home for money you earn abroad and want to park in India.
NRO (Non-Resident Ordinary) accounts hold India-source income — rent, dividends, interest from your old FDs, pension, business income. Interest here is taxed at 30% TDS (before treaty relief), and repatriation is capped at USD 1 million per financial year with CA certification.
Most NRIs need both accounts. This tool helps you route each type of income to the right one, and flags the DTAA paperwork that will lower your TDS.
Educational tool — not investment advice
Calculations are based on the assumptions you provide. Tax rules are simplified and change frequently. Verify with a qualified Chartered Accountant or tax professional before acting. Past returns do not guarantee future results. Repatriation limits, TDS rates and DTAA benefits depend on your specific tax residency and treaty position. Consult a CA before large transfers.