TaxFinancial Glossary
NRO Account
Definition
Non-Resident Ordinary account used to manage income earned in India such as rent, dividends, pension, and interest. NRO accounts can hold both Indian and foreign currency deposits. Interest earned is taxable in India at 30% plus surcharge and cess (before DTAA relief). Repatriation is permitted up to USD 1 million per financial year after tax clearance.
Why It Matters
NRO accounts are essential for managing Indian income streams. The key difference from NRE accounts is that NRO interest is taxable in India (NRE interest is tax-free), and repatriation from NRO requires Form 15CA/15CB and tax compliance certificates. Many NRIs maintain both NRE (for foreign earnings) and NRO (for Indian income) accounts simultaneously.