Hi Sreekanth,
First of all, thank you so much for creating this wonderful platform and sharing a lot of valuable information here.
I am an US NRI. During my visit to India in Aug 2017, I purchased Mutual Funds. These are linked to my bank accounts as:
- HDFC Lump sum Mutual Fund (Repatriation option) – HDFC NRE account
- Reliance Lump sum Mutual Fund (Repatriation option) – HDFC NRE account
- Reliance SIP (Repatriation option) – HDFC NRE account
- ICICI Prudential SIP – ICICI Savings account (Not an NRE/NRO account)
- After two months, the ICICI SIP was canceled because of some KYC status failed. There is no issue with the Reliance SIP. Is this because of ICICI account not being an NRE/NRO account? I see my status as KYC verified when I enter my PAN in CAMS and KARVY website. The KARVY website also shows a cKYC number.
- HDFC and Reliance Mutual Fund websites are not allowing me to purchase Direct plans as I have a US address. How can I purchase Direct plans online? Does CAMS or MFUtility allow this for US NRIs?
- I and my wife wanted to begin a joint SIP. Is it possible to do everything online from here? My wife’s PAN is not KYC verified. Can I do it online?
- What is the difference between the tax status NRE and NRO? Is it like, for NRE I pay taxes in US and for NRO, I pay taxes in India? If this is the case, can I change my current Mutual Funds from NRE to NRO? I prefer paying taxes to Indian government.
3 Answers
Hi,
1 - Did you update your Residential Status in KYC?
An NRI can invest in MFs through NRE/FCNR accounts only (on repatriation basis) and through NRO account on non-repatriation basis.
2 - I believe that some fund houses are yet to accept fresh purchases for US NRIs duet to FATCA compliance issue.
https://www.relakhs.com/fatca-compliance-requirements-impact-mutual-fund-investments/
NRIs can register and invest in MFs (subject to FATCA) through MF Utility platform.
(https://www.mfuindia.com/InvestorFAQ)
3 - Yes, some of the fund houses / online platforms do provide online kyc provision (eKYC)
https://www.relakhs.com/ekyc-for-mutual-fund-investments-by-quantum-reliance-mutual-fund-houses/
4 - An NRI can invest in MFs through NRE/FCNR accounts only (on repatriation basis) and through NRO account on non-repatriation basis.
Long term Capital gains on equity mutual funds are tax-exempt in India.
https://www.relakhs.com/mutual-funds-taxation-rules-capital-gains-tax-rates-on-mfs-fy-201516/
Thank you Sreekanth for answering my questions. I should have replied earlier, but thought of getting back once we register online with Reliance Mutual Funds. We have been waiting to hear back from Reliance since last few days to complete our registration. I will get back to you once it is done.
Thanks,
Harsha
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