NRI News Letter from SBI Thiruvananthapuram Circle… October 2020/Vol.1, No.

10

HIGHLIGHTS OF THIS EDITION

E
 News Round Up
 News from the Bank TURNING INDIAN TAXATION
 Interest Rates
 Residential Status of an Individual as per IT Act for AY 2021-22
 SBI Magnum Children’s Benefit Fund

NEWS ROUND UP

KERALA

 Kerala Infrastructure Investment Fund Board (KIIFB) has given approval for as many as 66 infrastructure
projects in various sectors at ₹2,953.36 crore. Health and family welfare projects have been given priority
by KIIFB. (Source: The Hindu)
 The Kerala government has launched an online portal (available on the official website of Directorate of
Industries and Commerce, Government of Kerala - http://Industry.kerala.gov.in ) for speedy and
transparent delivery of concessions, including interest subsidy for the revival of Micro Small and Medium
Enterprises (MSMEs), hit badly by the economic downturn triggered by COVID-19. (Source: The Hindu)
 The Agency for New and Renewable Energy Research and Technology (ANERT) has plans to equip Kerala
with an electric vehicle charging station every 50 km or 25 stations in each district and to switch the entire
network of stations within a year to solar power as the State’s e-mobility projects move forward.
(Source: The Hindu)
 Robot named CET-Covbot V1.0 developed by students of College of Engineering, Thiruvananthapuram has
been handed over to Government Medical College Hospital authorities. The robot can perform tasks such
as automatic sanitizer dispensing, remote patient assistance, delivering food and medicines, collecting
samples and specimens, in addition to announcement of COVID-19-related messages and warnings.
(Source: The Hindu)

FINANCE

 Trade deficit shrinks to $2.72 b compared to $11.67 b in September 2019. Sectors such as readymade
garments, drugs and pharmaceuticals, iron ore, rice, cereals, carpets and engineering goods pulled up the
country’s total goods exports in September by 5.99 per cent (year-on-year) to $27.58 billion.
(Source : The Hindu Business Line)
 The country’s foreign exchange reserves surged by $5.867 billion to touch a record high of $551.505 billion
in the week to October 9, as per RBI data. (Source : The Hindu Business Line)
 The monetary policy committee (MPC) of the Reserve Bank of India (RBI) kept policy rates unchanged and
predicts GDP growth rate in 2020-21 at - 9.5%. (Source website : business-standard.com )
 In order to facilitate swift and seamless payments in real time for domestic businesses and institutions,
Reserve Bank of India has decided to make available the RTGS system round the clock on all days from
December 2020. India will be among very few countries globally with a 24x7x365 large value real time
payment system. This will facilitate innovations in the large value payments ecosystem and promote ease
of doing business. (Source : RBI website)
 As per FIS Global report Real-time payments doubled this year and transaction value increased by 80 per
cent. India leads the world in real-time payments by handling 41 million transactions per day.
(Source website : business-standard.com)

NEWS FROM THE BANK

HOUSING LOAN CONCESSION UPTO 31.12.2020

Concessions in Interest rate based on CIBIL Scores

CIBIL Score: CIBIL Score: CIBIL Score:
Loan Amount Above 775
700 to 725 726 to 775
Above Rs. 30 lacs to Rs75 lacs(pan India) 0.05% 0.10% 0.10%

Above Rs. 75 lacs to Rs. 2 Crs(pan India) 0.05% 0.15% 0.20%

Above Rs. 2 Crs to Rs. 3 Crs (For Metros)* 0.05% 0.15% 0.20%

* 8 Metro Centres – Delhi NCR, Mumbai MMR, Kolkatta, Chennai, Ahmedabad, Hyderabad, Bengaluru and
Pune.

➢ Processing Fee for Home Loans through Builder Tie Up (BTU) : NIL

For more details please contact us at: rehbu.lhotri@sbi.co.in ; Contact No : 0471 -2192362/359

CAR LOAN CONCESSION UPTO 31.01.2021

➢ 50% reduction in Processing Fee.

➢ Nil processing charges for green Car(Electric Car) Loans

For more details please contact us at: cmauto.lhotri@sbi.co.in; Contact No : 0471 -2192368
 TAX COLLECTED AT SOURCE(TCS) – FY 2020-21(W.E.F 01.10.2020)

➢ Finance Act 2020 has widened the scope of section 206C of the Income-tax Act, 1961 (‘the Act’) by
introducing Tax Collected at Source (TCS) on remittances made under Liberalised Remittance Scheme
(LRS) of Reserve Bank of India under sub section (1G) w.e.f. 01.10.2020 and has prescribed the below
mentioned rates for collection of tax on the transaction amount.

SECTION DESCRIPTION TCS RATE

PAN / Aadhaar PAN / Aadhaar
available not available
206C(1G) LRS – remittances out of India* 5% 10%
206C(1G) LRS – remittances out of education loan * 0.5% 5%

* If a Bank in India receives an amount for remittance out of India under the Liberalised Remittance Scheme
(LRS) of RBI from a resident individual, the Bank is required to collect TCS at the rate of 5% on the aggregate
remittance amount exceeding Rs. 7 lacs during a financial year.
* For remittance out of Education Loan Funds, the concessional rate of 0.5% is applicable. For margin
money remittance, normal rate of 5% is applicable.
➢ In case of remittances made for overseas tour programme packages, TCS is applicable on all remittances
even if the amount is less than Rs.7,00,000/-
(Overseas tour programme package refers to any tour package which offers visit to a country/territory or
countries/territories outside India and includes expenses for travel or hotel stay or boarding or lodging or
any other expense of similar nature)

➢ TCS is not applicable for Outward Remittance from NRE / FCNR accounts

FCNR Interest rate with effect from 10th October 2020 (in % p.a); (Annualized yield at the end of the period) #
Resident Foreign
FCNR (B) Deposits
Currency (RFC)
Currency USD GBP EURO CAD AUD JPY USD GBP EURO
Period Rate Yield Rate Yield Rate Yield Rate Yield Rate Yield Rate Yield Rate
1 year 0.73 0.74 0.56 0.57 0.01 0.01 0.73 0.74 0.10 0.10 0.02 0.02 0.73 0.56 0.01
1 year to < 2 years 0.73 0.74 0.56 0.57 0.01 0.01 0.73 0.74 0.10 0.10 0.02 0.02 0.73 0.57 0.01
2 years to < 3 years 0.73 0.75 0.57 0.58 0.01 0.01 0.55 0.56 0.13 0.13 0.05 0.05 0.76 0.60 0.01

3 years to < 4 years 0.76 0.78 0.60 0.61 0.01 0.01 0.61 0.63 0.15 0.15 0.05 0.05
Maximum: 3 yrs
4 years to < 5 years 0.77 0.79 0.64 0.66 0.10 0.10 0.69 0.71 0.23 0.23 0.05 0.05 only
5 years 0.84 0.87 0.68 0.70 0.15 0.15 0.76 0.78 0.31 0.32 0.05 0.05

Interest Rate on NRI Loans

NRI Home Loan Starting from 6.95%
SBI Home Top Up Loan Starting from 7.50%
SBI REALTY - Home Loan for purchase of Plot Starting from 7.65%
P-LAP -Personal Loan Against Property Starting from 8.80%
Car Loan Starting from 7.75%
Green cars (Electric cars) Starting from 7.55%
 RESIDENTIAL STATUS UNDER IT ACT FOR AY 2021-22
1. As per Income Tax Act, 1961, an individual is termed as:

(a) “Resident”; or
(b) “Deemed to be Resident”; or
(c) “Resident but not ordinarily resident” [RNOR]; or
(d) “Non-Resident”
2. There is always a common tendency to search for ‘Non-Resident’ definition or in other words what conditions
must be satisfied to become non-resident. However, the Indian Income tax Act approach is to define who is a
‘Resident’ and accordingly, those who do not satisfy the definition of ‘Resident’ will automatically be termed as
“Non-Resident”.

3. Before looking at the definition of residential status, categorise the ‘Individual’ whose status you are going
to ascertain as under:

(a) Indian citizen who leaves India for employment (Refer 4)

(b) Indian citizen as a member of Indian ship (Refer 5)

(c) Indian citizen or PIO who being outside India comes on a visit to India (not having total income, other than
the income from foreign sources, exceeding fifteen lakh rupees during the previous year) - (Refer-6)

(d) Indian citizen or PIO who being outside India comes on a visit to India (having total income, other than the
income from foreign sources, exceeding fifteen lakh rupees during the previous year) - (Refer-7)

(e) Indian citizens (PIO excluded) not liable to tax in any other country (Refer-8)

(f) Individuals not covered in (a) to (e) above. (Refer-4)

RESIDENT IN INDIA
4. An individual is resident in India if he satisfies ANY ONE of the basic conditions:

(a) If during the relevant previous year he is physically present in India for a period aggregating to 182 days or
more; or

(b) If he is physically present in India for a period aggregating to 365 days or more in the 4 immediately preceding
years and 60 days or more in the relevant previous year.

If the individual satisfies condition (a) then he need not look at condition (b).

5. In the case of an Indian citizen who leaves India in the relevant previous year
(i) as a member of the crew of an Indian ship; or

(ii) for the purpose of EMPLOYMENT OUTSIDE INDIA, the basic condition are slightly different as under:

(a) If during the relevant previous year he is physically present in India for a period aggregating to 182 days or
more; or

(b) If he is physically present in India for a period aggregating to 365 days or more in the 4 immediately preceding
years and 182 days or more in the relevant previous year.

6. In the case of an Indian citizen or a person of Indian origin (not having total income, other than the income
from foreign sources, exceeding fifteen lakh rupees during the previous year) ,being outside India who comes ON A
VISIT TO INDIA, the basic conditions are as under:
(a) If during the relevant previous year he is physically present in India for a period aggregating to 182 days or
more; or

(b) If he is physically present in India for a period aggregating to 365 days or more in the 4 immediately preceding
years and 182 days or more in the relevant previous year.

7. In the case of an Indian citizen or a person of Indian origin (having total income, other than the income from
foreign sources, exceeding fifteen lakh rupees during the previous year) being outside India who comes ON A VISIT
TO INDIA, the basic conditions are as under:

(c) If during the relevant previous year, he is physically present in India for a period aggregating to 182 days or
more; or

(d) If he is physically present in India for a period aggregating to 365 days or more in the 4 immediately preceding
years and 120 days or more in the relevant previous year.

8. Deemed to be Resident:

An individual, being a citizen of India, having total income, other than the income from foreign sources, exceeding
fifteen lakh rupees during the previous year shall be deemed to be resident in India in that previous year, if he is not
liable to tax in any other country or territory by reason of his domicile or residence or any other criteria of similar
nature. It is clarified by CBDT that in case of an Indian citizen who becomes deemed resident of India under this
provision, income earned outside India by him shall not be taxed in India unless it is derived from an Indian business
or profession

RESIDENT BUT NOT ORDINARILY RESIDENT [RNOR]

9. Once the Individual qualifies as “Resident in India”. The next step is to ascertain whether the individual is (a)
Ordinarily Resident; or (b) Not Ordinarily Resident in India (RNOR). The RNOR status is very important for returning
Indians because under this status there are some tax exemptions available to them.

10. An individual (not covered under 11 & 12 below) qualifies as ‘RNOR’ if he fulfills any one of the two alternative
conditions laid down as under:

(i) he has been non-resident in India in nine out of the ten previous years preceding the relevant previous year;
or

(ii) he has during the seven previous years preceding that year been in India for a period aggregating to 729 days
or less

11. An individual being a citizen of India, or a person of Indian origin, having total income, other than the income
from foreign sources, exceeding fifteen lakh rupees during the previous year, qualifies as RNOR if, he has:

(a) been in India for a period or periods amounting in all to one hundred and twenty days or more but less than
one hundred and eighty-two days during the previous year.

12. An Individual qualifying as “deemed to be Resident” (Refer-8) will always be RNOR.

[The writer is Mr. Dinesh Nair, Chartered Accountant, M/s Dinesh Nair & Associates, Mumbai, Email:
dinesh@dineshnair.com]
[For more details please Contact : Abhin R Naik, AVP & Business Head SBI Channel, Thiruvavanthapuram
SBI Funds Management Pvt Ltd, Mob:9995023421, Email: Abhin.Naik@sbimf.com]
______________________________________________________________________________________________
NRI DEPARTMENT
LOCAL HEAD OFFICE, POOJAPURA,
THIRUVANANTHAPURAM, KERALA - PIN 695 012
Email : nridesk.kerala@sbi.co.in
TeL : +91 471- 2351836,2192355 / 358