Mumbai, Jan. 17
The Reserve Bank of India has notified relaxation in remittance norms regarding salary earned by foreign nationals employed in India by a foreign company or an Indian citizen employed by a foreign company outside India.
These individuals, according to the RBI, may open, hold and maintain a foreign currency account with a bank outside India and receive the whole salary payable to him for the services rendered to the office/branch/subsidiary/joint venture in India of such foreign company, by credit to such account, provided that income-tax chargeable under the Income-tax Act, 1961, is paid on the entire salary as accrued in India.
Hitherto, the amount that could be credited to the foreign currency account with a bank outside India could not exceed 75 per cent of the salary accrued to or received by the expatriate or Indian national from the foreign company.
Further, the RBI said that a citizen of a foreign State resident in India employed with a company incorporated in India may open, hold and maintain a foreign currency account with a bank outside India and remit the whole salary received in India in Indian rupees, to such account, for the services rendered to the Indian company, provided that income-tax chargeable under the Income-tax Act, 1961 is paid on the entire salary accrued in India.
The relaxation in the remittance norm by the RBI follows the Government notifying the same through a Gazette notification.