NRI Corner – Align Investment

Welcome to the NRI Corner at Align Investments!

India has emerged as a prime investment destination for Non-Resident Indians (NRIs) and persons of Indian origin. With a thriving economy, a robust Rupee, and flourishing companies, investors can expect maximum returns from both equity and debt markets. Our extensive experience in the market allows us to capitalize on this favorable environment to help NRIs achieve their investment goals.

Service Offered for Non-Resident Indians:

NRI Strategy: We facilitate the process for NRIs to repatriate funds into India by opening NRE accounts, ensuring seamless transactions.
Goal Definition: Investors define their investment objectives, allowing us to tailor a mutual fund portfolio that aligns with their goals and risk tolerance.
Mandate Holder: NRIs have the flexibility to appoint a mandate holder, such as Mr. X or a trusted individual, to implement the investment strategy on their behalf, streamlining the process without delay.
Continuous Monitoring: We continuously monitor the performance and progress of the portfolio, refining the strategy as needed and conducting portfolio rebalancing to optimize returns.
Regular Updates: Investors receive regular updates on their portfolio, keeping them informed and engaged in their investment journey.

Investing in stocks and mutual funds entails market risks, and investors are advised to carefully read the offer documents and consult their investment advisor before making any investment decisions.

With our user-friendly platform and seamless processes, managing your investments from overseas has never been easier. Stay connected with your financial goals and let Align Investments be your trusted partner in achieving long-term financial success, no matter where you are in the world.

Why invest in India?

Fastest growing Economies

Largest youth population in the world

Rising global competitiveness

Rising economic influence

In the last 15 years, India has been amongst the top 10 fastest growing economies
By 2030, India’s working –age Population is expected to exceed 1bn. On the other hand, the population is rapidly ageing in the developed world.
25% of incremental global workforce over the next decade is expected to come from India.
Countries with a larger share of the working population ( Appox 60%) to the total population are likely to witness higher GDP growth rates.
India is where China was in 2006,( China’s growth in next 10 years (CY06-16) was 14.5)
Annual House holds Income 3.87 Lakh in 2010 to 5.24 Lakh in 2019 & Expected to grow 7.32 Lakh in 2030.
34 million new households (HH) likely to enter Aspirers category while 43 Mn House hold to enter Affluent & Elite category by the end of this decade.
By 2030, India will have more than 50% of household in the middle and higher income group which leads to higher consumption share in the economy
India is now world’s largest digital economy. (E Commerce users -2nd largest in the world, internet subscribers – 2nd largest in the world, telecom subscribers- Largest in the world)
India is 3rd Largest Manufacturer of pharmacy in terms of Volume & 14th in Value
PLI Scheme to attract investment of 1.50 trn Over the next 5 Year.
PLI scheme will not only promote Manufacturing But will also create huge employment Opportunities in India.
Renewable energy share targeted at 40% of cumulative power generation by 2030
India is world’s 3rd largest energy market and is expected to be the fastest growing energy market globally through 2050
From Traditional Stock trading in 1990 to dematerialization in 1996 and the emergence of mobile trading in 202, daily market volume soared from 100 crores to 80,000 crores
India has the third-largest group of scientists and technicians in the world.
1.35 Bn Indians are covered under Aadhar Scheme, one of the world’s largest social security programs.

Investment Avenues:

NRIs are permitted to invest in mutual funds both on repatriable as well as non repatriable basis. There is no limit for investment in domestic mutual funds.
NRIs are permitted to purchase non-convertible debentures of Indian Companies, Fixed Deposits with Public Limited Companies, commercial papers issued by Indian companies, bonds issued by Public Sector Units (PSU’s).
NRIs are permitted to invest in Government securities through primary dealers.
NRIs can make investments in shares and convertible debentures of Indian Companies both on repatriation and non repatriation basis.

Documents required for NRI investment

For an NRI investment applying for mutual fund or any other investment instruments Following KYC Documents are required

Please Note: If you are a 1st time investor in mutual fund then needs to do ‘KYC (Know your client)’.This is a onetime process required to invest in mutual funds.)

For KYC, you need to submit few given required documents:-

Indian PAN card copy (Self attested)
Passport Copy (Self attested)
Domestic address proof (Self attested)
If POI,the POI card (compulsory)
Overseas Address Proof copy like Utility Bill, Driving license etc (Must be in English, if not need to translate by registered translator)- ( Self attested)
Passport size photos
Fully Filled & Signed KYC form

Other Requirement/ Detail

Fully Filled FATCA Copy (With TIN or SSN No)

Eligible Mutual Fund Companies or Asset Management Compnaies For USA- Canada Resident.

While NRIs from other countries can invest in mutual funds in India without any hassle, US/Canada based NRIs are faced with certain cumbersome compliance requirements under FACTA (Foreign Account Tax Compliance Act) to invest in mutual funds in India.

Nevertheless, many mutual fund houses allow NRIs based in the USA and Canada to invest in India in a hassle-free manner, but the options are limited. Let’s look at the mutual funds for NRIs from USA/Canada to invest in India.

Sr No	AMC Name	USA	CANADA	Remark / Declaration
1	Aditya Birla SL AMC limited	Accept	Accept
2	Axis Mutual Fiund	Accept	Accept	Physical Application Only With Declaration
3	Bajaj Finserv Asset Management Co Ltd	Accept	NOT Accepted	Physical Application Only With Declaration
4	Bandhan Mutual Fund	Accept	NOT Accepted	Physical Application Only With Declaration
5	DSP Investment Managers Pvt Ltd	Accept	NOT Accepted	Physical Application Only With Declaration
6	Edelweiss Asset Management Pvt ltd	Accept	NOT Accepted	Physical Form With Valid Visa Copy & Passport Copy
7	HDFC Asset Management Co Ltd	Accept	NOT Accepted	Physical Form With Valid Visa Copy & Passport Copy
8	ICICI Prudential AMC Ltd	Accept	NOT Accepted	Physical Application Only With Declaration
9	IIFL asset Management Ltd	Accept	Accept
10	IDBI Mutual Fund	Accept	Accept
11	ITI Asset Management Fund	Accept	Accept	Physical/ Online Possible
12	Kotak Mahindra AMC Ltd	Accept	Accept	Physical Application Only With Declaration
13	Mahindra Manulife AMC Ltd	Accept	NOT Accepted	Physical Application Only With Declaration ( Only Lumpsum)
14	Motilal Oswal AMC Ltd	Accept
15	NAVI Mutual Fund	Accept	Accept
16	Nippon India AMC Ltd	Accept	Accept	Physical/ Online Possible + Declaration Form Required
17	PPFAS Asset Management Pvt Ltd	Accept	Accept	Physical Application Only With Declaration
18	Quant MF	Accept	Accept	Physical/ Online Possible
19	Samco asset Management Ltd	Accept	Accept
20	SBI Fund Management Ltd	Accept	Accept	Physical Application Only With Declaration
21	Sundaram Mutual Fund	Accept	Accept	Physical/ Online Possible
22	Tata Asset Management Ltd	Accept	Accept
23	Taurus Asset Mgt Co Ltd	Accept	Accept
24	Trust Asset Management Pvt Ltd	Accept	Accept
25	UTI Mutual Fund	Accept	Accept
26	White Oak Asset Management Limited	Accept	Accept	Physical Application Only With Declaration

Taxation for NRI

If you are an NRI planning to invest in Indian mutual fund schemes, here are four important taxation rules that you should be aware of to plan your investment decisions better.

1. TAX ON CAPITAL GAINS

Tax on gains from mutual fund investment for NRIs is on lines similar to that for resident Indians. Capital gains are divided into two types: LTCG (Long Term Capital Gains) and STCG (Short Term Capital Gains

For gains that are realised from equity funds within a year of investment, STCG will be applicable and the gains taxed at a flat rate of 15%. For a holding periodmore than a year, LTCG will be applicable and taxed at 10% without indexation benefits over and above the overall exemption limit of Rs. 1 lakh

For investment made before April 1, 2023 in mutual funds other than equity funds,LTCG will be applicable at 20% of the gains with the benefit of indexation, if the investment is held for more than three years.

For non-equity mutual funds with less than 35% equity holdings in their overall portfolio, any gains on investment on or after April 1, 2023,and a holding period of less than three yearswill be classified as STCG, added to the total income of the taxpayer,and taxed as per the income tax slab rate applicable.

Please note that the Finance Bill of 2023 has removed the benefit of LTCG and indexation benefits on investments mutual funds that have less than 35% of their portfolio in equity assets from April 1, 2023.

This means that all gains made from investments made on or after that day will be considered as STCG and taxed accordingly.

Here is a summary of tax rates classified on the basis of the type of mutual fund.

*Applicable Tax Rates on Capital Gains on Mutual Funds for NRIs*
Type of Mutual Fund	STCG Rate	LTCG Rate
Equity Funds	15%	10%*
Non-Equity Funds (invested before April 1, 2023)	As per the applicable Income tax slab rate	Listed Securities 20%** Unlisted Securities 10%
Non-Equity Funds (invested on or after April 1, 2023)	As per the applicable Income tax slab rate	As per the applicable Income tax slab rate

*10% over and above the overall exempted amount of Rs. 1 lakh

**20% tax on gains with indexation benefits

2. TAX DEDUCTED AT SOURCE (TDS)

One crucial factor that differentiates between NRIs and resident Indians when it comes to taxation on mutual funds is the TDS. Resident Indians are not subjected to TDS when they redeem their MF investments. This is not so for NRIs, with the TDS on their redemption amounts depending on the fund type and the holding period.

If NRIs redeem their investments in equity-based mutual funds after a year, LTCG will be applicable, and TDS equal to the 10% of LTCG levied on the total redemption amount. If the redemption is before a year, then STCG will be come into play, with TDS equal to 15% of the STCG applied.

On the other hand, for non-equity debt or other mutual funds with less than 35% equity assets in their overall portfolio, any gains on investment on or after April 1, 2023, and a holding period of less than three years will be classified as STCG, and the redemption amount subject to a 30% TDS for those belonging to the highest income tax bracket.

For investments made before April 1, 2023 and those having a holding period of more than three years, gains will be classified as LTCG, with a 20% TDS on gains with indexation benefits will be play for the redemption amount.

For investments made on or after April 1, 2023, all the gains will be classified as STCG, irrespective of the holding period, andthe redeemed amount subjected to a TDS of 30% for those belonging to the highest income tax bracket; people falling in the lower tax bracket is can claim a refund.

Below is a table that summarizes the TDS on gains for NRIs on their mutual fund investments as per fund types and holding period.

*Applicable TDS Rates on Capital Gains on Mutual Funds for NRIs*
Type of Mutual Fund	TDS on STCG	TDS on LTCG
Equity Funds	15%	10%
Non-Equity Funds (invested before April 1, 2023)	30^	Listed Securities 20%** Unlisted Securities 10%
Non-Equity Funds (invested on or after April 1, 2023)	30^	30^

**20% tax on gains with indexation

^TDS is deducted at 30% assuming the assessee belongs to the highest income tax bracket.

3. DOUBLE TAXATION RULES

Many NRIs may wonder if they need to pay taxes again in their home country if they have done so in India for gains made from their Indian mutual fund investments. The answer is, no, they don’t need to pay taxes on the same gains twice if their adopted country is among the 86 nations that have active Double Tax Avoidance Agreements (DTAA) with India.

But even if the adopted country does not have such a fully-exempt agreement, NRIs from there can still avoid paying higher taxes if they pay tax in India on gains from their Indian investment.

4. PROVISIONS FOR SET-OFFS

NRIs can also set off their capital gains with their capital losses as per the provisions under the Income Tax Act. This is similar to what is applicable to resident Indians as well.