Returning to India as a Non-Resident Indian (NRI) or Overseas Citizen of India (OCI) involves several compliance requirements related to income tax, bank accounts, investments, and foreign assets. Below is a comprehensive guide:

1. Tax Residency Status

Your tax residency status determines your compliance obligations:

• Resident: If you stay in India for:
  • 182 days or more in a financial year, or
  • 60 days or more in a financial year and 365 days in the preceding four years.
  (Note: NRIs returning permanently may get RNOR status for 1–3 years.)
• Resident but Not Ordinarily Resident (RNOR):
  • Exempt from tax on foreign income unless earned in India or received in India.
• Non-Resident:
  • Only income earned or received in India is taxable.

Action:

• Assess and confirm your residency status at the start of each financial year.

2. Bank Accounts

• Convert NRI Accounts:
  • NRE and NRO accounts must be re-designated to Resident Rupee Accounts.
  • FCNR deposits can be held until maturity and then converted to Resident Foreign Currency (RFC) accounts.
• Open an RFC Account:
  • To park foreign earnings or convert FCNR deposits.
  • RFC accounts are freely repatriable and earn interest.

3. Foreign Assets and Income

• Declaration of Foreign Assets:
  • Report foreign assets, bank accounts, and investments in the Schedule FA of your Indian income tax return.
• Taxation on Foreign Income:
  • If you are an RNOR, foreign income is not taxable unless it accrues or is received in India.
  • Residents must disclose and pay taxes on global income.

Double Tax Avoidance Agreement (DTAA):

• Claim relief under DTAA for taxes paid in the foreign country.

4. Investments

• Mutual Funds and Stocks:
  • Update your KYC status with financial institutions from “NRI” to “Resident”.
• Real Estate:
  • You can continue to hold property abroad or in India but need to comply with FEMA if selling and repatriating funds.
• Other Investments:
  • Review and update the residential status for fixed deposits, Demat accounts, etc.

5. Insurance Policies

• Inform insurers about your return to update the policy status.
• Continue holding existing life and health insurance policies if allowed by local regulations.

6. Tax Filing

• File an income tax return in India if:
  • Your income exceeds the basic exemption limit.
  • You have foreign assets or income (disclosure required in ITR).

7. Repatriation of Funds

• Before returning, repatriate funds from overseas accounts to India if needed.
• Utilize RFC accounts for holding foreign currency funds in India.

8. Aadhaar and PAN

• Aadhaar: Mandatory for residents; apply for one after your return.
• PAN: Ensure your PAN is active and linked with Aadhaar.

9. Social Security Contributions

• Claim benefits from social security schemes in countries where you worked (e.g., 401(k) in the U.S., EPF in other countries).

10. FEMA Compliance

• Abide by FEMA rules for holding assets abroad.
• Report foreign assets if you plan to liquidate or transfer them to India.

Key Documents to Keep Handy

1. Passport (with entry/exit stamps).
2. Tax residency certificates from the foreign country.
3. Bank account statements and investment records.
4. Tax filings in the foreign country.

Would you like help with a specific compliance requirement, such as tax filing or updating investment accounts?