NRI DEMAT ACCOUNT

Who Is An NRI?

An Indian citizen who resides outside India for a total of 183 days in one financial year is considered to be an NRI under section 6 of the Income-tax Act.

NRI Trading Requirements

Investment Options	Trading On a Repatriation Basis	Trading On Non – A Repatriation Basis
Equity	NRE PIS Bank Account NRE PIS Trading Account NRE PIS Demat Account	NRO Non-PIS Bank Account NRO Non-PIS Trading Account NRO Non-PIS Demat Account
Mutual funds / IPO	NRE Non-PIS Bank Account NRE Non-PIS Trading Account NRE Non-PIS Demat Account	NRO Non-PIS Bank Account NRO Non-PIS Trading Account NRO Non-PIS Demat Account
Derivatives	–	NRO Non-PIS Bank Account NRO Non-PIS Trading Account NRO Non-PIS Demat Account Custodial Participant Code

Documents Required To Open On NRI Trading Account

NRE/NRO bank account
PIS permission letter
Pan Card
Overseas address proof – Copy of driving license/foreign passport/utility bills/bank statement (not more than 2 months)/notarized copy of rent agreement/leave & license agreement/ Sale deed.
Proof of NRI Bank account – A canceled cheque leaf of your NRE or NRO savings bank account
Indian address proof – if any
Passport size photo
FEMA declaration
FATCA declaration

NOTE: It is required for foreign nationals self-certify and notarizes their PAN cards, passports, and foreign addresses in ordertoenterIndia.The Indian Embassy or any other competent authority like aConsularOffice / Notary Public / Magistrate / Judge / Local Banker in the country where the NRI resides must perform the self-certification and notarization.

What Is NRE AND NRO Account?

NRE (NON RESIDENT EXTERNAL)	NRO (NON RESIDENT ORDINARY)
Park your foreign income earned outside India.	You can park foreign income in your NRO Account if you manage the income earned in India.
NRE accounts are exempt from tax.	An NRO account earns interest (30% according to the Income Tax Act 1961)
Can repatriate	Within the set limit, you can repatriate.
Exchange rate risks can affect your NRE account and currency fluctuations.	(1 million USD in a financial year)
Exchange rate risks are associated with NRE account and currency fluctuations.	Not prone to exchange rate risks.
Only equity delivery	Equity delivery and derivatives

How To Open NRE & NRO Account?

If an NRI is in India, he or she can visit the bank office to go through all of the necessary formalities for opening a new account with all required documentation.
They can apply for an NRI account online by visiting the bank site and downloading the forms. When you’re done filling out your form and submitting any required documents, it’s time to submit everything to the bank for approval! These days all banks give this service – just make sure that you have a strong internet connection when opening your account.
Non-resident Indians (NRI) can visit the bank branch in a foreign country and provide all the details and documents required.

What Is PIS Account?

They may choose to open a portfolio NRI investment scheme account if they would like to purchase shares in Indian companies directly. PIS accounts allow non-resident Indians to buy and sell shares and convertible debentures of Indian companies on the BSE and NSE via an NRE or NRO bank account.

How To Open PIS
(Portfolio Investment Scheme) Account?

To open a PIS account, follow the below process.

An NRI wishing to apply for PIS accounts needs to request the bank where he has opened his NRE account for Form PIS.
To submit a duly filled-up PIS form with required documents to the bank and further send it to RBI for approval, you should fill out the “PIS Form” in our system.
Once the RBI approves, this NRE bank account will be designated as an NRE PIS Bank Account.

What Is FEMA Declaration?

You must ensure that any deal where stocks are exchanged will not involve, and may not be designed to evade the provisions of the Foreign Exchange Management Act 1999 or any rule, regulation, notification direction, or order issued under it.

What Is FATCA Declaration?

The 2010 HIRE Act established FATCA, a United States government policy that requires financial institutions to report details on accounts controlled by US taxpayers and instances of tax evasion. Financial organizations are obliged to withhold taxes if an individual doesn’t provide the documents required for FATCA compliance. An inter-government agreement between India and the United States in 2015 mandated that Indian tax officials acquire specific data from North American country investors, granting them access to their bank records without consent or notification thereof until recently (2017).

The aim of FATCA is to increase transparency and reduce avoidance by observing the income generated by NRIs living in the United States on property outside; not just assets but also investments such as stocks traded on Wall Street’s NYSE market, etc., which will be captured via regulators monitoring foreign exchange trading volumes across exchanges dealing with USD trade settlement instruments like EUR/USD currency pair that can translate into dollarized profits exceeding $1 million per annum, especially when compounded over time periods longer than ten years meaningfully highlighting disproportionate levels of success vis-à-vis non-domiciled individuals residing elsewhere naturally.

Custodial Account
(For NRI F&O Trading)

An NRI must also obtain a custodial participant code in order to trade in the derivatives market. Clearing and settling the trade (CP) is a unique code. The CPT code is necessary for clearing and settling trades- it can be obtained by approaching a stockbroker/custodian who is clearing members of Futures and Options – derivatives. Once these brokers have verified that all documentation is filled out correctly and given their approval, they will allocate a unique CP code to you. You now can start trading in the derivatives segment by maintaining adequate margins with your broker.