NRI Q&A: For returning NRIs of India, is there any way to save the tax on the NRE Savings interest?

Here is a recent online query:

For returning NRIs of India, is there any way to save the tax on the NRE Savings interest?

This is typically interesting. If you keep your money overseas, you can avoid the Indian taxes that is relatively high and hardly 1% of Indians pay taxes. In other words, practically the Government does not want the funds to be brought back to India. Looks weird!!!

Response below:

Evaluating just tax on your interest/savings is very myopic and can lead to poor decisions. Why do I say that?

  • Repatriate or not is a question that requires a lot of thought
    • Interest / dividends income in many western countries is taxable. For instance, if you have an account in the US, UK or Canada, your financial institution will automatically report it to tax authorities, and may also deduct tax (TDS) before you get paid.
    • Interest rates in the west – in $s??s or ? -?are much less than offered for??.
    • Of course other factors like exchange rate fluctuations will have to be taken into account
  • It is not practical – or wise – to evade taxes. Look for holistic strategies to avoid and minimize taxes. Check out?Difference Between Tax Avoidance and Tax Evasion (with Comparison Chart) – Key Differences
  • Tax planning needs to take a 360 view of your earnings and finances and not just interest
    • Unless you are a professional financier or full-time investor (e.g Warren Buffet), Interest and dividends from investments are going to be one component of your earnings.
  • Tax planning will also have to consider one?s global income considering tax treaties India has with other governments . E.g -?US ? India tax treaty – IRS.gov

Another key factor to keep in mind: A ?returning NRI? will become a (tax) ?resident? of India after returning and spending a set period of time in India.

Bottomline: Trawling in Quora and online forums may give you partial answers. If you have sizable income and investments, hire a competent tax adviser.

NRIs doing good for their motherland

Here are a couple of recent stories of NRIs giving back to their motherland

NRI donates 1 Lakh for Udaipur Government School

– By Udaipur Times Team on December 29, 2016

kusum

NRI Kusum Singhvi showed her love,?belonging?and responsibility towards her hometown by donating items worth Rs 1 Lakh at Government School situated at Bhatiyani Chauhata.

Kusum said that even though she is staying abroad, she cannot forget her homeland and her responsibilities towards the same. Kusum and Aamir Singhvi have been staying in USA for the last 40 years. They said that they have always wanted to do something for the kids in India and have also been motivating other NRIs to take up similar steps.

Chief Guest, District Education Officer Virendra Pancholi, said that it is a great source of motivation for kids to see an NRI come and work towards their development. This will go a long way in boosting the morale of the students.

Singhvi family gave material including tables, chairs, sweaters, dresses, registers, notebooks, carpets etc amounting to Rs 1 lakh.

District Education Officer acknowledged the efforts of Singhvi family by garlanding them.


NRI alumnus makes gesture for a cause

– The Hindu

A cardiologist settled at Atlanta in the U.S., Sreeni Gangasani, an alumnus of 1985 batch of the Kurnool Medical College (KMC), on Tuesday donated a dozen stents, each costing about Rs. 40,000, for implantation in the poor patients.

Dr. Sreeni handed over the stents to KMC principal G.S. Ramgopal during a continuing medical education programme on cardiology held as part of the diamond jubilee celebrations of the college.

Recalling the last wish of his friend, who died of cancer, to contribute Rs. 50 lakh from his account for the social cause, the cardiologist also promised to donate Rs. 25 lakh for development of infrastructure in the college and an equal amount to the cardiology department in the Kurnool general hospital. Dr. Sreeni later delivered a lecture on heart failure update 2017.

Another alumnus of 1985 batch, Mahesh Mulumudi, settled at Seattle in the U.S., suggested a partnership between the alumni members in the U.S. and the Kurnool Medical College for academic and financial support to the college. Dr. Mahesh delivered a lecture on ?what?s new in interventional cardiology? at the CME.

The medical college was geared up to celebrate its diamond jubilee and would launch its e-magazine in January 2017 to share experiences of professors and suggestions of students, KMC principal G.S. Ramprasad said. The college planned a series of CMEs to hone the knowledge of its faculty members and students and would conduct several events in collaboration with doctors abroad in July 2017, he added.

Miss India Nepal Worldwide 2013

ON HER WAY TO SUCCESS! Miss India Nepal Worldwide 2013.. Garima Pandey, the only actress in Bollywood after Manisha Koirala who makes her way into Bollywood.

Hailing from Nepal, she has already made her mark in the beauty industry by carving her name on the trophy of Miss India Nepal Worldwide ?2013 & now she is on her way to mark her brilliance in Bollywood.

She is probably the only actress after the very gorgeous Manisha Koirala who is on her way to make it big in Bollywood “There are not many actresses in Bollywood who have successfully made a mark in the industry after Manisha Koirala who has not only done some brilliant work but made Nepal proud. Earlier she was the daughter of Nepal not she is the daughter of the nation”

“She has been my inspiration in every way. From her acting skills to the way she has conducted herself, she has been outstanding. Just like her I would like to do some iconic work and make Nepal proudadds Garima Pandey.

?I belong to a simple family back ground where we don?t have any association with Bollywood, but it was my passion for this art which made me pursue acting” says Garima.

Yet another Child custody story: NRI parents protest as Norway takes custody of child

The NRI media is focused on highlighting the plight of the Non-Resident family in Norway, where their 5-year old child was taken into custody in December 2016.

Here are a facts you should know

  • Indian governement is involved. Thanks to lobbying by the parents, India’s External Affairs minister has got involved
  • This is the Third case in 5 years: earlier examples
    • In 2011, a three-year-old and a one-year-old were separated from their parents, Sagarika and Anurup Bhattacharya. The then UPA government took up the issue with the Norwegian government. The Norwegian court later allowed the children to be reunited with their parents.
    • In December 2012, a court in Norway convicted an Indian couple in a child abuse case. Anupama Vallabhaneni was sent to jail for 15 months, and her husband, Chandrasekhar, got an 18-month prison term. The children, 7 and 2 years, were sent to their grandparents in Hyderabad.

Incidents like these makes one wonder if there is there is a fundamental social issue at play here – Indians going overseas are expected to live by local values and mores.?Disciplining children ?the “Indian” – spare the rod and spoil the child – way is a big no-no.


 

NRI couple in Norway lose custody of child, seeks Sushma Swaraj’s help: (Firstpost):? “A five-and-a-half-year-old boy was taken away from his NRI parents by Norwegian authorities on Wednesday, reports said. The officials accused the parents of beating the child. This is the third such incident in the past five years where a child was taken away by the Child Welfare Department of Norway.

NRI parents protest as Norway takes custody of child (Indian Express):?Speaking to The Indian Express, the father of the boy, Anil Kumar said that the authorities did not even give them prior information. The child, Aryan, was taken into custody on 13 December from his kindergarten school at 9.30 am. “They did not give us prior information. At 10 am, the same day, four policemen came to my house, took my wife into custody, and interrogated her from 11.15 am to 2.45 pm,” said Kumar.?Kumar, who is a citizen of Norway, moved to Oslo 26 years ago from Punjab and is a owner of an Indian restaurant. Speaking to CNN-News18, Aryan’s father said that the authorities had absolutely no evidence against them and that the authorities did not have summons to take Aryan.

Kumar and his wife met their son at the welfare home on Monday. ?He was wearing the same clothes and undergarments in which he had gone to school a week ago. He is not receiving proper care from the child welfare department. He hugged us and cried a lot? he is our only child?why would we torture him,? he said.

?He is an active child, and is very fussy about eating? He likes to eat Indian food? he is being given bread and porridge, and has not been eating well,? he said. ?I have never even raised my voice at him, how can I beat him up? His mother spent sleepless nights taking care of him as he is an asthma patient. How can we physically hurt our beloved son,? said Kumar.


 

 


 

Cultivating Pluralism at a Critical Time

[ Press Release ]

Dear Friends,

We greet you at the end of 2016, an extraordinary and critical year for the Pluralism Project and for America’s public and political commitment to pluralism. At a time when many Americans are uncertain about the strength of our identity as a multireligious and multicultural nation, the Pluralism Project looks with confidence to the vision, the reality and the future of the American experiment. It is a vision based in the Constitutional promise of religious freedom, a blueprint for the very diversity that is ours today.?As we move forward, we do so with renewed resolve, and a new mission that will inform our ongoing, and increasingly important efforts:?The Pluralism Project:?Engaging, Educating, and Strengthening the Next Generation of?Religious and Civic Leaders in the United States.

For more than two decades, the Pluralism Project has studied the changing religious landscape of our nation.?Our confidence in pluralism ?the engagement of our differences in the common project of citizenship?is based on grassroots research among the religious communities of the United States. We have come to know the diverse and dedicated faith communities of our nation through their hospitality, their energy, and their commitment to American values. Our vision is deeply informed by the enduring principles and practices of the world?s religions and, above all, by the emerging infrastructure of interfaith engagement that is strengthening local communities across the country.

We are confident that these gains cannot be reversed by the forms of fear and division that have come to the surface in the turbulence of the election and its aftermath. Engaging our diversity in cities and towns across the country will continue to be the strength of our democracy. Our goal is to support and encourage the next generation of civic and religious leaders as they strengthen the bridges and networks of relationship that will serve a diverse, dynamic, and interdependent society.

In his most recent book, Thomas Friedman has forcefully mentioned Harvard’s Pluralism Project and our insistence that pluralism is not mere diversity, but engagement with that diversity, not relativism, but the encounter of commitments based on dialogue across differences. “Being able to embrace and nurture this kind of true pluralism is a huge asset for a society in the age of accelerations,” he writes. “Indeed, I would go a step further and say that the return on investment on pluralism… will soar and become maybe the single most important competitive advantage for a society ?for both economic and political reasons.”

We ask you to invest in the promotion of pluralism. The Pluralism Project engages students, teachers, and citizens in tackling the most important issues of our time. But the project of pluralism must engage all of us ?and we invite you to that engagement in the New Year that lies before us.

Sincerely,

Dr. Diana L. Eck

Director, The Pluralism Project
Want to invest with us in this immensely important work?
Make a tax-deductible donation online?or donate by check at the address below, payable to Harvard University (Memo note: “Pluralism Project”)

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Viewpoint: Why NRIs are so judgmental about India?

In the past two+ decades, I have lived and worked in a dozen countries across three continents. And during the time, I have frequently visited India.

After making annual trips back to my hometown from my adopted homeland in America, I recently took a conscious decision to spend an extended period of time in Bangalore. My family story is not atypical of that of scores of other NRIs ? aging parents unable to manage on their own due to flailing health, yearning for their offspring?s to be around. Rather than contributing to the emerging market of ?old age? homes in India by coaxing my parents to spend their sunset years in one such institution, I thought spending quality time with them was more valuable. Thus my wife, son and I find ourselves back in the bedroom in a home where I spent college years.

The fact is that not all NRIs are judgmental about India. So why do NRIs come across as being judgmental, even without meaning to do so?

The key reason is that NRIs have a point of reference. Having experienced better quality of life in the West – enforcement of law and order, zoning in cities, orderly traffic – NRIs may find the chaos of urban India jarring.

    • Population – Over 1.2 billion people, over three times the population of the US lives in in a land ?About twice the size of Alaska? More people chasing fewer resources can impose a burden on the society – lesser land to build, more people with more cars driving or roads that can?t expand etc etc.

— ?NRIs may subconsciously be comparing the life ?back home? with the urban sprawl they encounter during visits to India.

  • Traffic and pollution – This is perhaps a genuine criticism. I learnt to drive a stick-shift car in India years ago and have owned Automatic cars in the west. During my trips back to India, I am comfortable driving on the left-side and just following the traffic at low-speeds. However, the effort involved in trying really hard not to bump into bikes ziz-zagging between cars, navigating between taxis, cabs and autos trying to cut across lanes can be stressful, to say the least.
          — I am learning to navigate through traffic as safely as I can but I wonder if complaining about chaotic roads makes me

    judgmental?

 

  • Utter lack of zoning or enforcement of zoning. Take the example of Bangalore where ?residential? and ?commercial? areas are clearly mapped in the city plan documented by different government agencies. However, the reality is different in most ?residential neighborhoods,? Multi-story flats, office complexes, hostels and shops co-exist, adding to the strain on civic resources – water, sewage, electric and roads.
    — NRIs, who have learnt to respect zoning regulations, and enforcement of civic responsibilities may find it jarring to see neighborhoods they grew up in turn out to be concrete jungles.

Bottomline: India continues to change; some of it is for the good and some not-so good. Check out my blog post (link posted at the bottom)

Read the rest of my musings: Return to India Musings: when a home becomes a golden egg – on Mohan’s blog and musings

Indore builders duped us: NRI couple

NDORE: An NRI couple from Scotland, who had purchased an apartment in Mangal Nagar, on Tuesday claimed that they had been duped by builders as they have still not got possession of the flat despite being promised so. The incident came to fore after the duo came to the city and approached in-charge DIG Harinarayan Chari Mishra at the public hearing.

In their complaint, Pushpalata Rohila, who worked as a manager at oil and gas industry and her husband Harsh Nama, an IT worker, said that they had purchased a flat in Classic City in Mangal Nagar from Swastik Infrastructure Company.

“We had been promised possession of the flat by November 15, 2015. The owners of the company – Ankit Shrivastav and Aman Sehgal – had also signed an agreement saying that they will pay Rs 10,000 as rent for the flat if the deadline of possession was breached by the builders,” said Harsh while speaking to TOI. He said that they also completed registry formalities for the flat and when they approached the owners again, they were told that they will be given the under-construction flat latest by December 15. 2016.

“Even after calling them several times, we got no response. We had purchased the flat by taking a loan and we are also paying interest on the loan. We have been deceived by the builders and have faced mental harassment,” he said.

“Everyone in my family including my sister-in-law who lives in scheme number 78 and my sister who also lives in city have faced problems because of these people. Since we were in Scotland, they had to approach the police and also builders for the possession,” said Harsh.

He said that after coming to India, he came to know that both the builders were allegedly absconding and there were other similar cases registered against them

“The police will take action in the matter at the earliest,” said in-charge DIG Harinarayan Chari Mishra
Article source TOI