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About this tool
Compare NRE and NRO deposits on tax, TDS and repatriation, with post-tax maturity value for the same interest rate.
This comparator shows what the same deposit at the same interest rate is worth in an NRE account versus an NRO account, once Indian tax is applied. NRE interest is exempt under Section 10(4)(ii) of the Income-tax Act and carries no TDS, while NRO interest is taxable and withheld under Section 195 at 30% plus surcharge and 4% cess, so an NRO balance compounds net of tax. It also sets out the repatriation difference: NRE funds move out freely, NRO balances up to USD 1 million per financial year.
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Compares maturity values after withholding, not just the quoted rate.
Swaps the 31.2% domestic rate for a lower DTAA rate on interest.
Flags when an NRO balance exceeds the USD 1 million yearly ceiling.
Yes. Interest on an NRE account is exempt under Section 10(4)(ii) of the Income-tax Act for as long as you are a person resident outside India under FEMA, and no TDS is deducted. The exemption is Indian only, so the interest may still be taxable where you live.
Interest paid to a non-resident is withheld under Section 195 at 30%, plus surcharge where the payment crosses Rs 50 lakh and 4% health and education cess, giving 31.2% in the ordinary case. A Double Taxation Avoidance Agreement can bring the rate down, often to 10% or 15%.
Balances in an NRO account are repatriable up to USD 1 million per financial year under the FEMA remittance facility, supported by Forms 15CA and 15CB from a chartered accountant. NRE principal and interest have no such ceiling.
Income arising in India, such as rent, dividends, pension or the proceeds of an Indian asset sale, must go into an NRO account; an NRE account may only be credited with funds earned outside India. Many NRIs hold both, and a cross-border tax adviser can confirm the right split for your situation.