The answer is both Yes and No, it depends on the source of funds. Technically, Yes, you can deposit INR or Indian rupees in NRE account in India with both private banks e.g. HDFC, ICICI, Kotak, YesBank, Federal Bank, and any public sector banks like SBI, Bank of Baroda, Bank of India, etc, provided the source of INR is another NRE or FCNR account. So, if your friends, relative, or wife has an NRE saving account and they can legally transfer Indian Rupees to you.
Similarly, if you have more than one NRE account let's say one NRE account with SBI and another NRE saving account with HDFC then also you can deposit INR from SBI NRE to HDFC NRE account. Both are perfectly legal, though you have to be careful when you ask friends to deposit money because that would be considered a gift and you may need to pay income tax on that.
Asking wife or parents to transfer money to the NRE account should be fine because they are immediate family members. Also, NRI can open more than one NRE account with different banks in India.
NRE accounts are somewhat restricted in terms of permissible credits. These accounts are opened in Indian rupees and all foreign exchange deposits received for credit of these accounts are first converted to Indian rupees at the bank's buying rate. You can see this list of all the permissible ways to deposit money into an NRE account.
Can NRI deposit Indian Rupees in NRE Saving Account?
On the other hand, you cannot deposit INR to your NRE account from any other source e.g. you cannot transfer money from your friends or wife's resident saving account to your NRE account.
Since the source of those funds is not overseas they are not eligible to deposit on an NRE account which allows free repatriation of funds i.e. you can online transfer money from your SBI NRE account to the USA, Canada, UK, Singapore or any other country.
Even If you have a resident saving account with the same bank, you cannot transfer money from the resident saving account to NRE. In fact, you need to first ask your bank to convert your resident saving account to NRO account before opening an NRE account.
One exception to the rule is that you can transfer INR from the NRO saving account or fixed deposit to an NRE account but that is subject to a limit of 1 million USD per year. You also need to take a written approval and pay taxes in advance before transferring Indian rupees from NRO to NRE saving the account. See this article to learn more about how to transfer money from an NRO account to an NRE account in India.
![Can NRI deposit INR in NRE Account in India? [Answered] (1)](data:image/gif;base64,R0lGODlhAQABAAAAACH5BAEKAAEALAAAAAABAAEAAAICTAEAOw== "Can NRI deposit INR in NRE Account in India? [Answered] (1)")
Now, the questions come what if you have sold a property and got a big amount of money on Indian rupees, where should you deposit that? Well, NRO accounts are for just these purposes. You can deposit rental income, royalty income, income from selling properties, etc into an NRO account. Once you got the money in the NRO account you can start the procedure for transferring INR to your NRE account.
That's all about whether you can deposit INR into your NRE account in India or not. As I said, it's perfectly ok to deposit money in your NRE account from India be it the SBI NRE account or HDFC NRE account. The only thing which is important is the source of funds. You can only deposit INR which is from other NRE accounts or NRO accounts. You cannot deposit INR from the resident saving account to your NRE account.
Just remember, once your income tax status changes to NRI, you cannot keep your resident saving account or resident fixed deposit. You need to convert them to an NRO saving account and fixed deposit as early as possible.
Other NRI Related Articles You may like to read
- Is it mandatory to file income tax returns for NRIs?
- 3 Income tax benefits of opening NRI accounts in India
- 13 ways to save income tax in India
- 5 Tax Saving options not available to NRIs
- Is NRI's overseas income taxable in India
- How much TDS is deducted from the NRO account?
- How much is the minimum account balance in the NRI account?
- 10 Income tax deductions and exemptions NRIs should know
- How NRIs can file their income tax returns online
- Is it mandatory for NRIs to declare foreign bank accounts on tax returns?
- How to determine the tax residential status of NRIs?
- 10 points NRIs should know about Income tax?
- Is Aadhaar card Mandatory for filing an Income tax return for NRIs?
Thanks for reading this article so far, if you find this information useful then please share it with your friends and colleagues. If you have any questions or feedback then please drop a note.
FAQs
NRE accounts are exclusively designed to help NRIs invest their foreign earnings in India or support their family. Once you deposit your earnings in the account, the NRE account currency is converted to Indian Rupees. Thus, to answer your question, one can't deposit money in INR in an NRE account.
Can I deposit rupees in a NRE account in India? ›
Since the NRE account is rupee-dominated, the deposits are converted to INR. And while there isn't any specific NRE account deposit limit, you cannot deposit cash in INR into your NRE account. Avail higher, tax-free and fully repatriable interest on your NRE savings account with Asia's safest bank. Learn more.
How much money NRI can deposit in India? ›
Many NRIs often ask, “how much money can I transfer online?” An NRI should be aware of remittance limits. There is no ceiling on the money an NRI can send to India. This money, however, needs to be earned through legit means.
How much money can be transferred to NRE account in India? ›
The Reserve Bank of India allows the transfer of funds up to USD 1 million a year from an NRO to an NRE account. Here is a list of documents you will require if you are planning transfer funds from an NRO account to an NRE account, according to the IDFC FIRST Bank.
Can anyone transfer money into my NRE account? ›
One may transfer funds from a Non Resident External (NRE)/ Foreign Currency Non Resident (FCNR) Account to a Non Resident Ordinary (NRO) Account. However, one may not be able to transfer funds from NRO to NRE Account, as NRE Accounts can only accept foreign currency credits from outside India.
What are the limitations of NRE account? ›
Limitations of NRE Accounts
The crucial limitation of these accounts is that they cannot be used to deposit the money earned by an NRI inside the country. While there are numerous NRE account benefits, NRIs have to opt for an NRO account to save their earnings made in India.
How do I add money to my NRE account? ›
There are several ways in which you can transfer money to your NRE savings account. You can use wire transfers or money transfer services offered by your bank. You can do a transfer through by depositing or mailing foreign currency cheques and demand drafts.
Can we transfer Indian rupees to NRE account? ›
You cannot transfer money to a NRE account from a savings account in India. However, you can transfer money from NRO to NRE account. You can also transfer money from one NRE account to another.
Can I transfer money from NRE to a normal savings account? ›
Easy transferability: NRE funds are freely repatriable and can be to any account including resident account.
How much money can NRI transfer to India without tax? ›
However, any gift to a person who is not a relative* will be taxable for the recipient if the aggregate amount is greater than ₹50,000 as per Section 56(2)(x) of the Income Tax Act, 1961.
There is no limit on how much can be transferred to NRE account. No tax to be paid to Indian Govt for the interest earned in NRE Account but tax has to be paid to US Govt for the interest earned as long as you are tax resident at US. That means , you have to declare the interest income in US Tax return.
What is the NRE account rule in India? ›
NRE Account: The interest earned on NRE account balances is tax-free in India. Additionally, the principal and interest are exempt from wealth tax and gift tax. NRO Account: The interest earned on NRO account balances is subject to income tax in India. The tax rate is based on the individual's income slab.
Can I transfer money from my NRE account to USA? ›
The NRE funds can be repatriated only to customers' own/self-account abroad. The beneficiary's name should be same as per name of the account holder.
Can a NRE account hold foreign currency? ›
Deposit of Foreign Currency
As an NRI, you can deposit your earnings in the form of foreign currency into the NRE account. The foreign currency is then converted into Indian National Rupees at the prevailing exchange rate.
Can I use my NRE account to pay bills in India? ›
The most attractive part of an NRE account is that any amount is fully repatriable to your resident country- tax-free. Overall, NRE accounts provide a tax-free space for remittances, ample liquidity, an easy way to pay for expenses in India, and a medium to invest in India as well.
Do I have to pay tax in India for NRE account? ›
NRE (non-resident external) and FCNR (foreign currency non-resident) accounts are tax-free.
Can I convert my Indian savings account to NRE account? ›
Typically, you can convert your resident savings account to an NRO account, not to a Non-Resident External (NRE) account.
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