How FEMA treats you.
FEMA divides people into "persons resident in India" and "persons resident outside India". You become resident outside India when you leave to take up a job, run a business or live abroad for an uncertain period. Unlike income tax, which counts days, FEMA looks at your purpose and intention. See Non-Resident Indian (NRI) for how the two differ.
Indian citizens living abroad (NRIs) and OCI cardholders follow largely the same FEMA rules. Foreign nationals without Indian origin face more restrictions.
Bank accounts under FEMA.
- Re-designate resident accountsResident savings accounts must become NRO accounts once you are resident outside India.
- NRE for foreign earningsUK income sent to India goes into an NRE account and stays repatriable.
- NRO for Indian incomeRent, dividends and pension in India go into an NRO account.
- FCNR for foreign currencyFixed deposits held in GBP or other currencies.
- Joint holdersNRE accounts can be held jointly with other NRIs, or with resident relatives on a former-or-survivor basis.
- Returning to IndiaNRE accounts must be re-designated as resident or RFC accounts.
Buying, selling and inheriting property.
| NRIs and OCI cardholders | |
|---|---|
| Buy homes and offices | Allowed, paid through banking channels or NRE, NRO or FCNR accounts |
| Buy agricultural land, plantations, farmhouses | Not allowed |
| Inherit any property, including farmland | Allowed |
| Receive property as a gift | Homes and offices from relatives; not farmland |
| Sell homes and offices | To residents, NRIs or OCIs |
| Sell farmland | Only to an Indian resident who is an Indian citizen |
| Repatriate sale proceeds | See Repatriation of Assets |
Investments and loans.
Listed shares through the portfolio investment route, and most mutual funds, on a repatriable or non-repatriable basis.
NRIs can invest in Indian companies and LLPs under the FDI rules, with reporting to the RBI. See FDI Filing with RBI.
NRIs can take rupee loans from Indian banks, for example to buy a home, repaid from NRE, NRO or foreign funds.
Gifts and money transfers.
Resident relatives can send money to NRIs under the Liberalised Remittance Scheme, within the yearly limit, or credit rupee gifts to an NRO account. NRIs can give gifts to residents freely. Tax rules on gifts are explained on our Gifts page.
If you have broken a FEMA rule.
Common breaches include keeping a resident account after moving abroad, late reporting of investments and buying property that was not allowed. Penalties can be up to three times the amount involved.
Most breaches can be regularised through compounding: an application to the RBI, which settles the breach for a fee instead of a penalty. We prepare the application and the supporting documents.
The most common NRI breach. Fix it by re-designating the account and, if needed, compounding.
Agricultural land bought while an NRI breaches FEMA and needs specialist advice.
Late filings for company investments carry late submission fees.
Why NRIs in the UK choose us for India tax.
We work with the India side of your tax while keeping your UK Self Assessment and treaty position in view.
Every computation is checked by a second Chartered Accountant before anything is filed.
A written scope and fee before work starts, with no surprise charges later.
Encrypted document sharing and e-verification, so nothing needs a trip to India.
Returns, TDS refunds, FEMA questions and property sales handled by the same team.
Clear explanations of what you owe, why, and what to keep for next year.
FEMA advice for NRIs throughout the UK.
We advise NRIs and OCI cardholders in every part of the UK on FEMA: from setting up the right bank accounts after a move to regularising older mistakes.
London
South East
Midlands
North of England
East and South West
Scotland, Wales, NI
FEMA rules for NRIs FAQs.
Want peace of mind on FEMA?
Tell us what you hold in India. We will review it against FEMA and fix anything that needs fixing.
This page is general guidance based on Indian income-tax and FEMA rules as they stand, including the Income-tax Act, 2025 that applies from 1 April 2026. It is not legal or financial advice for your situation. Rates, limits and deadlines can change, so please speak to us before acting on it.