The $1 million dollar scheme for Non-Resident Indians (NRIs) is a Reserve Bank of India (RBI) regulation under the Foreign Exchange Management Act (FEMA) allowing NRIs/PIOs to repatriate up to USD 1 million per financial year (April–March) from their NRO (Non-Resident Ordinary) account. This facility permits the transfer of sale proceeds of assets, inheritance, or legitimate funds to a foreign bank account without prior RBI approval, provided taxes are paid.
NRI Repatriation. NRI repatriation enables Non-Resident Indians to transfer money from India to their country. It ensures compliance while giving NRIs access to their funds. The latest repatriation limit for transfers from your NRO account is up to USD 1 million annually.
NRIs can send tax-free gifts to relatives in India, but gifts to non-relatives over ₹50,000 annually may be taxable for the recipient under Indian tax law.
This scheme outlines a framework for the seamless transfer of Indian assets amounting to $1 million, approximately 8.3 crores in Indian rupees as of February 2024, within a given financial year.
LRS allows resident individuals to remit up to USD 2,50,000 per financial year for permissible current or capital account transactions. 2. Who is eligible for LRS? All resident individuals, including minors, are eligible, but the scheme is not available for corporates, HUFs, trusts, etc.
LRS Scheme for NRIs
Thus, they cannot remit funds from India, but they are permitted to transfer funds from NRO, NRE, and FCNR accounts abroad as per the regulations and requisite documentation: They are permitted to transfer up to USD 10,000 from an NRO account.
As per NRI Foreign Currency Rules in India NRIs can carry up to US $5,000 in cash and US $10,000, including cash, traveler's cheque, etc. Anything above this limit must be declared before the customs department upon arrival. If the cash is in Indian currency, then only up to Rs 25,000 is allowed.
FEMA rules governing NRI repatriation
According to FEMA, NRIs are allowed to repatriate up to USD 1 million per financial year from their NRO accounts, which may include their incomes such as rents, dividends, or pension from India after appropriate tax compliance.
Maximum marginal rate is the highest rate of tax at any income level. This means for those with incomes between Rs 2 crore and Rs 5 crore, 39% will be the highest applicable tax rate, and for those with incomes above Rs 5 crore, it will be 42.74% — the highest tax rate since 1992.
5 Legal & Smart Ways to Avoid Paying 20% TCS on Foreign Remittances in 2025
The Reserve Bank of India (RBI) governs such transactions through the FEMA (Foreign Exchange Management Act). NRIs can repatriate up to $1 million per financial year from India, including proceeds from the sale of property.
Disadvantages of FCNR Account
Lower interest rates compared to some INR deposits. Premature withdrawal before 1 year earns no interest. Joint holding only with other NRIs (not resident Indians). Limited liquidity since funds are locked for the chosen tenure.
Options for Generating Passive Income
How much cash can I have on a domestic flight? You can carry cash within the permissible limits set by the regulatory guidelines. In India, it is advised to keep your cash under ₹2 lakh unless documented properly.
According to it, residents of India can remit a maximum of $250,000 within a given financial year to individuals living overseas. This includes both capital and current account transactions.
Once you relocate to India, you must contact your bank to convert your NRI accounts to a resident account. However, you can hold FCNR (B) accounts until maturity. Alternatively, you can choose to convert your FCNR (B) deposit into a Resident Foreign Currency (RFC) Deposit Account.
If your income is above the taxable annual limit and the TCS paid is more than the total tax payable, TCS will be refunded to the assessee's bank account. If your income is above the taxable annual limit and the TCS paid is less than the total tax payable, the TCS paid will be adjusted to the total tax liability.
“Gifts” can be made in cash or other assets – securities, closely held business interests, real estate, artworks, collectibles or any other type of property. So long as the total market value of your gifts does not exceed $19,000 per recipient in 2026, the transfers are entirely gift tax-free.
Under the new rules effective from April 1, 2025, no TCS is applicable for foreign remittances up to Rs. 10,00,000 in a financial year.
The transfer limit for bank wires is $1 million per day, per client. The minimum amount for each bank wire is $100.
IRS Form 3520.
It is essential to properly file a timely Form 3520 to report a foreign inheritance or foreign gift in the year it is received by a U.S. person, as large penalties may be imposed on a taxpayer if the IRS later discovers that an inheritance was not properly declared.