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Exchange Earner’s Foreign Currency (EEFC) Account

[RFC account of a Returning NRI and Investment Abroad]

It is provided by Regulation No. 4 of Foreign Exchange Management (Foreign Currency Account by a Person Resident in India) Regulations. 2000, that a person resident in India may open, hold and maintain with an authorised agent in India, a Foreign Currency Account to be known as Exchange Earner’s Foreign Currency (EEFC) Account, subject to the terms and conditions of this Scheme specified in the Schedule.

 

Thus, the earners of foreign exchange are allowed to retain upto 25% of the inward remittance in foreign currency in such EEFC accounts. However, in the case of hundred percent export-oriented units and units in export processing zones, software technology parks or electronic hardware technology parks, upto 100 per cent of foreign exchange is allowed to be credited to the EEFC accounts. Any other person resident in India is allowed to credit 50% to EEFC A/c out of the foreign exchange earnings. The exporters who are allowed by the RBI to open foreign currency account abroad, are not allowed to open EEFC accounts. Thus, the NRIs returning to India in particular and the other residents in India in general who are exporters, should remember the provisions regarding the EEFC and take advantage of the same. The interest earned by a resident on EEFC account balances is, however, not exempt from income tax.

 
RFC account of a Returning NRI and Investment Abroad
1. Introduction - RFC Account Of A Returning NRI And Investment Abroad
2. Opening, Holding And Maintaining A Resident Foreign Currency (RFC) Account
3. Tax Haven For Returning Indians Via RFC Account
4. Exchange Earner’s Foreign Currency (EEFC) Account
5. Direct Investment Outside India By A Returning NRI Or A Resident In India

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Tax Guide for NRI - Tax Planning, Tax Saving, Investment Guidance for Non-Resident Indians !

1. Basic Aspects Of Tax Planning For NRIs
2. How an NRI can Avoid Clubbing of his Incomes and Wealth with that of his Spouse and Children
3. The Incomes of an NRI completely Exempt from Income Tax
4. Capital Gain of an NRI could be Completely Exempt from Income Tax
5. Items completely Exempt from Wealth Tax for an NRI
6. Special Procedure of Assessment regarding Income of an NRI from Foreign Exchange Assets
7. Deductions Allowed to NRIs in the Computation of Total Income and Tax Payable
8. Procedure for the Filing of Income Tax and Wealth Tax Returns, Assessment, and Refunds
9. Gifts by NRIs to Relatives and Friends can be made fully Exempt from Gift Tax
10. FEMA and NRIs Preliminary Aspects Analysed
11. Acquisition and Transfer of Immovable Property in India by NRIs and FEMA
12. Permissible and Prohibited Current Account Transactions in Case of NRI
13. Investment In Shares, Securities, Units And Other Activities, etc. by an NRI in India
14. Deposits in India by an NRI
15. RFC account of a Returning NRI and Investment Abroad
   
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