Non-Resident Indians have got permission from Reserve Bank of India to open account under National Pension Scheme. With this NRIs can create old age pension corpus in India, a form of social security which was not available till now. This move is expected to benefit the Indian economy as well as funds will flow in dollars and also increase the subscriber base. The governing body for NPS is Pension Fund Regulatory and Development Authority (PFRDAA). However the real benefit can be taken when NRI settles in India after retirement.

Who can open the account?

NRIs within the age group 18-60 years can open NPS account. There is no need of power of attorney so NRI has to open the account individually.

NPS account form:

NRIs have to fill NPS subscriber form. They can download this form from POP-SP. Apart from the foreign contact details, they will have to provide residential address in India. In addition to this, option to select pension fund manager will also be available.

Documents required by NRI to open NPS account:

There are minimal documents required which needs to be submitted to POP bank as follows:

• Completely filled subscriber registration form
• Copy of passport
• Copy of address proof, if address in passport is different than the local address

How to contribute funds?

Contribution in the NPS account can be done via NRE/NRO/FCNR account. However remember that it will carry foreign exchange conversion rules. Contribution amount can be also paid through inward remittances through normal banking channel.

How to check the status?

After submitting the mandatory documents, the application status can be checked on the website: https://cra-nsdl.com/. Applicant will need to enter 17 digit receipt number or acknowledgement number allotted by CRA-FC while filling the application form.

What if NRI is an Americn resident? FATCA compliance:

If NRI has US residency then they will have to provide NPS investment and annuity to the US tax authorities. This is as per the law in US under Foreign Account Tax Compliance Act (FATCA)

Where can NRIs open NPS account?

It is recommended to open NPS account in the POP bank where NRE/NRO account is already open. And there is no cap on the investment. However minimum investment is Rs. 6,000 which is not a very big amount for an NRI.
Upon maturity, the amount will be given in INR and there is no rule to take this money out of India.

Tax Benefit:

Additional tax exemption of Rs. 50, 000 in addition to the existing section 80C instruments.