How to LEGALLY Transfer Money from India to Abroad (2025 Guide)
Whether you're an NRI, OCI holder, or someone managing finances across borders, understanding money repatriation is crucial. Learn the RBI and FEMA rules, account types, tax implications, and step-by-step process to transfer money from India to abroad legally.
How to LEGALLY Transfer Money from India to Abroad (2025 Guide)
Confused about how to move your money out of India legally? You're not alone. Every year, thousands of NRIs and OCIs struggle with repatriation rules, RBI limits, and tax compliance. This guide breaks down exactly how to transfer money from India to abroad — without the headaches, penalties, or surprise taxes.
Key Takeaways
- NRE accounts allow fully free repatriation without restrictions or extra paperwork
- NRO accounts have a $1 million per financial year limit with tax compliance requirements
- Form 15CA and 15CB from a CA are mandatory for NRO account repatriation
- FCNR accounts are fully repatriable without tax implications
- Keep all records for at least 6 years in case of tax audits
What Exactly is Money Repatriation?
Simply put, money repatriation is the process of transferring legally earned money from India to another country. But here's the catch — you can't just wire money freely.
⚠️ Important: The RBI (Reserve Bank of India) and FEMA (Foreign Exchange Management Act) set clear rules on how much and under what conditions money can move abroad. Understanding these rules is crucial to avoid unnecessary delays or penalties.
If you're planning to open NRE or NRO accounts or already have them, understanding repatriation rules will help you make smarter decisions about where to park your funds.
Who Actually Needs to Repatriate Money from India?
Four Main Groups
- NRIs: Those who earn rental income, dividends, or are selling properties in India
- OCI Holders: Managing financial assets in India while residing abroad
- Foreign Investors: Businesses or individuals investing in India who need to move profits out
- Expats and Indians Moving Abroad: If you're moving back abroad after working in India, you may need to transfer your savings
Understanding Your Bank Accounts in India
Before you transfer money, you need to understand your bank accounts in India. Here's a detailed breakdown:
1. NRE Account (Non-Resident External Account)
This account is your best bet for repatriation since it holds foreign income converted to INR.
- You can freely transfer money abroad without restrictions or extra paperwork
- Interest earned is tax-free in India
- Principal and interest are fully repatriable
2. NRO Account (Non-Resident Ordinary Account)
This account is for income earned in India such as rental income, interest, and pensions.
- You can repatriate up to $1 million per financial year
- Requires tax compliance and documentation
- Form 15CA and 15CB required from Chartered Accountant
3. FCNR Account (Foreign Currency Non-Resident)
Great if you want to keep your funds in foreign currency without worrying about exchange rate fluctuations.
- Fully repatriable without tax implications
- Funds held in foreign currency (USD, GBP, EUR, etc.)
- No currency conversion risk
| Feature | NRE Account | NRO Account | FCNR Account |
|---|---|---|---|
| Currency | INR | INR | Foreign Currency |
| Source of Funds | Foreign income only | Indian + Foreign income | Foreign income only |
| Repatriation | Fully free | Up to $1M/year | Fully free |
| Tax on Interest | Tax-free | 30% TDS | Tax-free |
| Documentation | Minimal | Form 15CA/15CB required | Minimal |
Step-by-Step Repatriation Process
Choose the Right Account
If you already have an NRE account, your transfer will be simple. But if your funds are in an NRO account, you need extra documentation.
Get CA Certificate (Form 15CA and 15CB)
If you're repatriating money from an NRO account, this form confirms that taxes have been deducted as per Indian law. It clarifies that taxes have been paid and provides clearance for repatriating the money.
Submit Documents to the Bank
Bank requires:
- Identity proof — visa, passport, bank card
- Proof of source of funds — sale deed, rental agreement, investment papers, etc.
This is crucial.
Initiate the Transfer
Use the bank's online system or visit a branch. Most banks have a streamlined online process for repatriation.
Keep the Records
Retain all records for at least 6 years in case of any tax audits.
Tax Implications You Can't Ignore
Nobody likes taxes, but you can't ignore them. Here's what you need to know:
NRE and FCNR Accounts
- No tax is deducted at source
- Funds can be moved freely
NRO Accounts
- Tax is deducted at the rate of 30% plus applicable cess and surcharge
- A lower rate may apply due to DTAA (Double Taxation Avoidance Agreement)
- This is where Form 15CA/15CB is required to determine the applicable tax rate
Property Sale Repatriation
If you're repatriating money from a property sale:
- Capital gains tax applies
- You need a tax clearance certificate
- Limit of $1 million per financial year per individual
RBI Repatriation Limits
The Reserve Bank of India has set clear repatriation limits:
| Account Type | Repatriation Limit | Requirements |
|---|---|---|
| NRE Account | No limits | Transfer freely |
| FCNR Account | No limits | Transfer freely |
| NRO Account | Up to $1 million/year | Tax compliance required |
| Property Sale | Up to $1 million/year per individual | Tax clearance + documentation |
⚠️ Need to Transfer More? RBI approval is required if you need to transfer more than the allowed limits. You need to provide supporting documentation while seeking RBI permissions.
For a complete understanding of how these accounts work, check out our detailed guide on FCNR and RFC accounts for returning NRIs.
Tips for Smooth Repatriation
Do These Things
- Use an NRE account whenever possible to bypass restrictions
- Plan your transfers in advance to avoid last-minute tax hurdles
- Check exchange rates and fees — talk to the regional manager and relationship manager to get the best exchange rate for the amount you're transferring
- Consult a tax expert — crucial if you're transferring money from an NRO or FCNR account where you need tax validation certificates and DTAA documentation
Common Mistakes to Avoid
❌ Don't Do These
- Avoid using personal accounts to bypass limits — this can trigger compliance issues
- Don't exceed repatriation limits without proper approvals — it can lead to penalties
- Don't ignore documentation requirements — missing Form 15CA/15CB will delay your transfer
- Don't wait until the last minute — tax compliance takes time
Best Banks and Services for Repatriation
Not all banks and services offer the same ease of repatriation. Here are some best options:
Banks with Strong Repatriation Services
- ICICI Bank — Online processing available
- HDFC Bank — Strong NRI services
- IDFC Bank — Streamlined process
- SBI — Wide network
Forex Services
These can be useful for specific transactions:
- Wise
- Western Union
- Remitly
Most banks now have online transfer options, reducing paperwork and delays.
Need Help Opening NRI Bank Accounts?
We've partnered with IDFC Bank to make the process of opening NRE, NRO, and FCNR accounts as smooth as possible — even while living abroad.
Planning Your Financial Transition?
Money repatriation is just one piece of managing your finances across borders. Get comprehensive guidance on NRI banking, tax planning, and making a smooth financial transition.
Have questions about repatriation? Drop a comment below or join our WhatsApp group with like-minded returnees for support.
Frequently Asked Questions
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