Going abroad to work or earn is a huge thing. It doubles when you are in peace that, the things behind you are in order. Peace of knowing that you are on the right side of the rule book & also that there is no monetary loss or liability creation afterward. Here is the basic checklist for NRIs or an outgoing NRI.

NRIs need to take care of what is left in India & what is required in case they come back. Also, there are few things which are personal – like a term plan.

Let’s look at these must-haves for an NRI & Essentials in detail today.

Basic Checklist for NRIs

Let’s see all these points in details:

Setting up Bank Accounts for NRIs

Still, we meet a lot of investors or NRIs who have still not set up basic NRO & NRE accounts. You cannot have a Savings account in case you are an NRI.

FEMA says you are NRI once you leave or intend to leave India for an indefinite period.

Income Tax says you are NRI, once you qualify the DAY TEST of residency. Details

In the absence of correct understanding, investors delay and lose sleep.

Do not procrastinate this as this is a major blunder. You can know the accounts an NRI needs to maintain or can open here – in detail.

Also, you need to deal with DEMAT accounts and open a PIS account in case you still need to buy or sell shares.

Setting Payments in India

You are going but, in case you have assets here, they will need periodic payments for usage or fees to continue availing these after you are abroad. Eg electricity bill, Indian phone connection, locker charges, etc.

Most of these can be done by registering online on your NRO bank account.

See our EBOOK

Setting POA  for NRI in India

Many times you need to transact in India and physical presence is required to sign documents. These can be property or tax-related or banking matters.  It is impractical to travel on short notices. You can set up Power of Attorney to any of your relative who is resident in India.

POA can be specific (set up for a specific work. Eg dealing with banks or selling/buying a particular property) or it can be general (can be used for multiple tasks as mentioned in POA agreement).

This can be used to make changes in Mutual Funds, DEMAT, Utilities, etc, which need signatures.

POA is easy to make in India as abroad you need to get it verified at the embassy. This involves more time & paperwork. In India, it can be done using a local lawyer or using online services. Your financial planner can refer to one such service provider.

Plan for Tax Investments & Tax Filling

You continue to pat taxes in India & on your global income. Taxation work is divided into 2 parts – Investments & Filling.

One needs to make certain investments to save taxes in India. You need to continue these, but the amount may vary. You need to engage the financial planner or tax consultant to figure this out.

Also, you may need to file returns in India & abroad. You need to deal with different filling calendars & rules like DTAA. You may need a consultant/planner who can take care of all this on time. Dealing with Financial planner ensures that investments are carried out logistically (transactions) and as per long term plan (retirement or other goals)

Many financial planners now provided these value-added services of tax filling.

As pointed by our reader Mr Seetharama in the comments section that NRIs do not get all tax rebates like residents. The details are here in this post.

Term Plan for NRIs & Global Health Cover for NRIs

The most important starting step in financial planning is – Risk Coverage. There is a risk that income may get disturbed by uncertainties of life – like job loss, accident or death, etc.

A person carries responsibility for himself and family also. Any cut in income means – UNFULFILLED GOALS.

These can be insured using Insurance. And when we say insurance means – ADEQUATE INSURANCE. Adequate in terms of amount and servicing (global).

All Indian companies provide Term Plans. One must take it before settling abroad.

Most countries provide health plans. In jobs, employers also provide a health plan. You need to see if this is adequate.

NRIs can buy health insurance in India also. One must be care full with health coverage as the choice of your health insurance company will depend on providing you cover outside Indian Jurisdiction – A foreign Country. Hence most of the insurers tell to pay and get reimbursement afterward. This may cause a temporary liquidity problem for NRIs.

Whether to go about a Health Plan in India or Health Plan from an Insurance company operating in the country of your residence- depends on length your future stay.

In case you have or planning to come back in 3-4 years to India, you may purchase a policy from an Indian insurer. But in case it is more than 3-4 years you may look for options in the foreign country.

A Financial Plan for NRIs

The checklist for NRIs cannot be justified without a Financial Plan. A well-made & implementable – Financial plan with –

• Tax Planning
• Inflow & Outflow of Income in India & country of residence
• Investment Planning
• Risk Assessment
• Goals Planning
• Contingency Fund
• Asset Allocation

The plan needs to be traveling with your where ever you go!

This plan must be global compliant and take all native & foreign factors (like different rates of inflation, currency movements, global investments like 401K, etc) into consideration.

---

Check Wealth Financial Planners & Advisors – Financial Planning & Wealth Management Service – MANU Click Here

---

A Global Succession Plan

Being NRI means you have assets in India and you will make assets abroad too. You need to have a global succession plan.

The Succession Laws are ‘Country-specific’ and also depend upon:

1. Country of your Domicile,
2. Place of the resident when death occurs,
3. Location of properties,
4. Whether country of your domicile has Forced Heirship laws or Community Property laws

---

Do you know – In Dubai, if you have a joint bank account (eg with spouse) and one of the holders dies without a proper will (registered in UAE), the accounts get frozen till court issues succession certificate and the bank gets it. What if you have only one such account? You will be stuck with no money.

---

A situation like this can be avoided using a succession plan which is globally compliant.

Why this Checklist for NRIs?

a) Being abroad also means out of touch. Well, many things can wait but time once gone cannot be brought back. You need to set goals & plan to fund these.

b) Work in time saves nine.

c) Saves unnecessary frequent visits, time on travel. It also gives you more time to meet family & friends when you are in India on visits.

If you have any more such points for this checklist for NRIs, please add to the comments section below. Do let us know & we will learn from your experience. Any question? You are welcome to add!

---

Few More Readings to Make You an Expert: