Last Updated: April 2026
India's tax departure rules are built around the RNOR (Resident but Not Ordinarily Resident) transitional status — a 2-year window after ceasing full Indian residency that provides significant tax relief on foreign income. Understanding when you become NRI (Non-Resident Indian) under the Income Tax Act and FEMA (Foreign Exchange Management Act) is the first critical step, as the ITA and FEMA use different definitions. India's FEMA regulations also govern how you can repatriate assets — the LRS (Liberalised Remittance Scheme) and repatriation rules for NRIs are distinct tracks that determine how much money can leave India and via what process.
India-to-USA is one of the world's largest skilled migration corridors — H-1B, L-1, and EB-5 visa holders and their families. Key IN-US planning points:
RNOR window and US residency: During the RNOR period (typically 2 years after moving to the USA and becoming an NRI), you are not Indian-taxed on US-source income. This RNOR window is valuable — foreign investment income, US employment income, and capital gains realised while RNOR are exempt from Indian tax. After RNOR expires (2 years), you are a full NRI — only Indian-source income is Indian-taxable.
India-USA DTAA: India and the USA have a DTAA (1990) — US residents pay Indian tax on Indian-source income; claim FTC on US Form 1040 for Indian taxes paid. Indian dividends: 25% Indian withholding; reduced under DTAA. Indian property gains: India retains taxing rights; FTC on US return.
FBAR for Indian accounts: NRE, NRO, and FCNR accounts exceeding $10,000 must be reported on FinCEN Form 114 annually as a US resident. FATCA: Indian banks report US-person accounts to the IRS via CBDT's automatic exchange arrangement.
EPF and US tax: EPF is not clearly treated as a pension under the India-USA DTAA. The IRS may treat EPF as a foreign trust or retirement account — the tax treatment is uncertain. Withdraw EPF before becoming a US tax resident where possible to avoid complex US reporting.
CountryTaxCalc.com is reader-supported. When you use our partner links, we may earn a commission at no cost to you. Learn more about our affiliate partnerships
★ 4.3 Trustpilot · 287,413 reviews
Move your Indian savings to your destination country at the real exchange rate when you leave. Wise is used by NRIs globally for transparent, low-cost international INR transfers.
⚠ For currency exchange only — not a bank account replacement.
Transfer INR Internationally with Wise →★ 4.2 Trustpilot · 3,259 reviews
Bridge the gap between Indian health cover and your destination country's cover. SafetyWing covers expats and remote workers worldwide with flexible international health plans.
⚠ Not a replacement for comprehensive private health insurance in high-cost countries.
Get International Health Cover from Day One →You become an NRI (Non-Resident Indian) for Income Tax Act purposes when you spend fewer than 182 days in India in a financial year (April 1 to March 31). If you depart India on November 1, the current financial year (April 1 to November 1) has approximately 215 days in India — you are still resident for that year. The year in which you first spend fewer than 182 days is your first NRI year. RNOR status: even after becoming NRI-qualifying by day count, you may be RNOR for up to 2 years if you were a tax resident for 9 of the last 10 years OR present for ≥729 days in the last 7 years but do not meet the full ROR conditions. RNOR tax treatment is more favourable than full resident (no tax on foreign income). Determine your exact residential status for each financial year by checking the day count and the 2-of-10-year / 730-day conditions — this determines whether you are ROR, RNOR, or NRI and what income is Indian-taxable.
EPF withdrawal process for NRIs: (1) Ensure your UAN (Universal Account Number) is activated via the EPFO portal (epfindia.gov.in). (2) Link your Aadhaar (if held) to your UAN and verify your bank account details in the portal. NRO bank accounts are accepted for EPF credit. (3) Submit Form 19 (Full and Final Settlement) online via UAN Portal → Online Services → Claim (Form 31, 19, 10C, 10D). (4) Your previous Indian employer approves the claim. (5) EPFO processes and credits the balance (net of any TDS) to your linked bank account. TDS: if service < 5 years and amount >₹50,000: 10% TDS (with PAN) or 30% (without PAN). If service ≥5 years: no TDS. Timeline: 3–10 working days for online claims. Pension component (EPS): separately claim via Form 10C — pension is available from age 50 (reduced) or 58 (full) regardless of where you live.
Yes — the process depends on the type of Indian account. NRO account (most common for NRIs receiving Indian income): you can repatriate up to USD 1,000,000 per financial year. You need a CA certificate (Form 15CA and 15CB) from a Chartered Accountant confirming Indian taxes have been paid. Submit via the income tax e-filing portal and your bank. NRE account: fully repatriable — no limit on amount, no CA certificate required. NRE account principal and interest can be sent abroad freely. Resident savings account (converted to NRO): if you had a regular Indian savings account before becoming NRI, it should be converted to an NRO account (your bank will assist). You then follow the NRO repatriation rules above. The USD 1M annual limit is per person — with a spouse who is also an NRI, you have a combined USD 2M annual repatriation capacity. Consult your authorised dealer bank for the specific documentation requirements.
Inherited Indian property by an NRI: no inheritance tax in India (Estate Duty was abolished in 1985). You receive the property free of inheritance tax. However, capital gains implications on eventual sale: the cost base for CGT purposes is the Fair Market Value on the date of inheritance (for properties acquired after April 1, 2001) or the cost to the previous owner (for pre-2001 acquisitions, with indexation). As an NRI selling inherited Indian property: LTCG (held >2 years) at 20% with indexation; buyer withholds 20% TDS. Repatriation: you can repatriate the sale proceeds up to USD 1M per year via NRO account with CA certificate. For inherited property from a deceased parent, additional documentation (succession certificate, legal heir certificate, probate) may be required by the bank and FEMA. FEMA regulations for NRIs are at rbi.org.in — the RBI's Master Circular on Non-Resident Accounts covers all repatriation rules comprehensively.