How are funds in NRI accounts settled after the sale of securities?

When an NRI investor sells securities through Share India, the settlement process ensures the proceeds from the sale reach their designated account. The journey of those funds, however, depends on the type of NRI account. Generally, the process begins with the funds being credited to your Share India trading account. From there, the funds are transferred to your overseas bank account. This is a relatively straightforward process for NRE (Non-Resident External) accounts. 

However, for NRO (Non-Resident Ordinary) accounts, there’s an important distinction. Due to regulations governing NRO accounts, the funds will be transferred after deducting the applicable Tax Deducted at Source (TDS). This TDS is a tax withheld by Share India on behalf of the Indian government, ensuring compliance with tax laws related to NRO accounts. 

Therefore, while the sale proceeds initially land in your Share India trading account, the final transfer to your overseas account will reflect the TDS deduction for NRO accounts. It’s crucial for NRI investors to be aware of these nuances, especially regarding NRO accounts, to understand the final amount they receive after selling securities. Understanding these details can help NRIs manage their investments and finances more effectively.

For more details on how to open an NRI account, click here!