How-to NRI non-repatriable NRO investment

How to invest in mutual funds as NRI on non-repatriable basis

From WebNotes, a public knowledge base. Last updated 19 May 2026. Reading time ~4 min.

Key facts

Funding source	NRO account (India-sourced income)
Repatriability	Restricted; USD 1M/year via Form 15CA/CB
Use case	Investments for India-based needs (family support, property, return-to-India)
Tax	Section 195 TDS applies

NRI non-repatriable MF investment uses NRO-funded subscriptions. Proceeds remain in NRO and can only leave India under specific FEMA route (USD 1M / year per investor). This is the choice when funds are intended for India-based use (family support, property purchase, future return to India).

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Step-by-step procedure

See the procedure infobox above.

When NRO-funded is preferred

Scenario	Why NRO
India-based family support	Proceeds in INR for family use
Property purchase in India	Funds available for Indian transactions
Plan to return to India	Easy transition to resident accounts
India-sourced income (rental, etc.)	Natural NRO usage
Tax-efficient repatriation (within cap)	USD 1M/year sufficient for most

Non-repatriability mechanics

When you fund MF investment from NRO:

AMC marks the folio as non-repatriable.
All future redemption proceeds credit to NRO.
Cannot directly send proceeds abroad without Form 15CA / 15CB.
USD 1M/year cap on outward NRO remittance.

For larger annual repatriation: RBI approval needed (rarely granted).

FEMA Form 15CA / 15CB

To repatriate from NRO abroad:

Form 15CA: Declaration by remitter (you).
Form 15CB: CA certificate (mandatory for taxable remittances > Rs 5 lakh; some exemptions).

Process:

Compute capital gains / income from NRO-held assets.
Pay any pending Indian tax.
CA issues Form 15CB for tax-paid amount.
Submit Form 15CA online with 15CB attached.
Bank processes outward remittance.

Comparison to repatriable

Aspect	NRE-funded (repatriable)	NRO-funded (non-repatriable)
Source funds	Foreign-earned	India-sourced
Repatriation	Free	Restricted (USD 1M/year + Form 15CA/CB)
Tax	Same Section 195	Same Section 195
Compliance	Lower	Higher (FEMA documentation)
Use case	Future country-of-residence access	India-based use

NRO vs repatriable balance

Many NRIs maintain both:

NRE for repatriable (~70% of investments).
NRO for India-use (~30%).

Allocation based on personal financial planning.

External references

References

Foreign Exchange Management Act, 1999.
Income Tax Act, 1961, Sections 6, 195.
RBI FEMA Master Direction on NRO repatriation.
SEBI (Mutual Funds) Regulations, 1996.

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WebNotes Editorial Team

The WebNotes Editorial Team covers Indian capital markets, payments infrastructure and retail investor procedures. Every article is fact-checked against primary sources, principally SEBI circulars and master directions, NPCI specifications and the official support documentation published by the intermediary in question. Drafts go through a second-pair-of-eyes review and a separate compliance read before publication, and revisions are tracked against the SEBI and NPCI rule changes referenced in the methodology section.

Last reviewed: 19 May 2026
Conflicts of interest: WebNotes is independent. No relationship with any broker, registrar or bank named in this article.