Portfolio Investment Scheme (PIS) Account

Yes, the sale proceeds (net of taxes) of the capital instruments may be remitted outside India or may be credited to NRE (PIS) account of the person concerned.

The Portfolio Investment Scheme (PIS) is a scheme of Reserve Bank of India defined in Schedule 3 of the Foreign Exchange Management Act 2000. As per the scheme, NRIs can purchase and sell shares and convertible debentures of Indian Companies on a recognised stock exchange by routing such purchase/sale transactions through their NRE PIS account with a Designated Bank Branch.

As per Reserve Bank of India (RBI) guidelines, NRI who wishes to invest in shares in India through a stock exchange need to approach the designated branch of any authorized dealer (bank) authorized by reserve bank to administer the PIS (Portfolio Investment Scheme) to open a NRE (Non Resident External) account under the scheme for routing Investments on repatriation basis.

No. We are offering account under Single holding pattern only.

Authorised Dealer banks would be required to provide the details of investment made by their respective NRI clients to the depositories in the format as provided by the depositories/ SEBI. In addition, the reporting to Reserve Bank in the existing system, viz., LEC (NRI) 

Trading partner of customer needs to submit contract notes for both purchase and sale within the time(T+1) specified by the designated bank to enable designated banks to report it to NSDL, CDSL and Reserve Bank of India.

Reserve Bank of India, CDSL & NSDL monitors the investment position of NRIs in listed Indian companies, reported by designated banks, on a daily basis. The depositories and exchanges shall display the available investment headroom, in terms of available shares, for all companies for which the breach has been activated, on their respective websites as mentioned below

CDSL: https://www.cdslindia.com/publications/FIMonitoring.aspx 
NSDL: https://www.fpi.nsdl.co.in/web/Reports/ForeignInvestmentLimitMonitoringListing.aspx
BSE: https://www.bseindia.com/static/markets/equity/EQReports/mfi_limits.aspx
NSE: https://www1.nseindia.com/products/content/derivatives/equities/fii_mi_position.htm

Yes, NRI Clients needs to ensure securities are not in RBI, NSDL and CDSL breach list before executing the purchase order.

NRI will have to off load such portion of the holding, which is in excess of the prescribed limit. Refer SEBI circular for details on Method of disinvestment : https://rbidocs.rbi.org.in/rdocs/content/pdfs/SEBI05042018.pdf

Shares purchased under PIS on stock exchange shall be sold on stock exchange only. Such Shares cannot be transferred by way of sale under private arrangement or by way of gift (except by NRIs to their relatives as defined in Section 6 of Companies Act, 1956 or to a charitable trust duly registered under the laws in India) to a person resident in India or outside India without prior approval of the Reserve Bank.

Yes, It is mandatory for a NRI to route all secondary market transactions through his PIS designated account i.e For all purchase / sell of stocks in secondary market only the PIS designated account should be debited / credited.

No, NRI Investor has to take delivery of shares purchased and give delivery of shares sold. Short Selling is not permitted.

You can send money in 14 currencies - USD, EUR, GBP, CAD, AUD, CHF, AED, SGD, HKD, NZD, JPY, ZAR, NOK, CNH.

Yes. It is the responsibility of the NRI to inform the change of status to the designated authorized dealer branch, through which the investor had made the investments in Portfolio Investment Scheme and the DP with whom he/she has opened the demat account. Subsequently, a new demat account in the resident status will have to be opened, securities should be transferred from the NRE/NRO demat account to resident account and then close the NRE/NRO demat account.

Yes. NRI need not obtain any PIS permission for applying in Primark market transactions like IPO. NRI Clients should provide the details to the designated bank regarding Quantity and date of allotment and cost of acquisition to calculate the taxes, if any.

Sell proceeds of shared acquired through Primary Market will get credited to respective NRE /NRO Savings Account of NRI.

No. NRIs cannot maintain NRE PIS with different banks. NRIs can assign only one Designated Bank for the purpose of routing the transactions under PIS for NRE.

The sales proceeds can be deposited after deduction of the applicable tax.

As per Indian tax laws, all the capital gains arising out of sale transactions are subject to tax. In the case of NRIs, the capital gain arising out of sale transaction is subject to deduction of tax at source (TDS) i.e. at the time of crediting the sale proceeds to the respective NRE/NRO account by the concerned bank branch. Accordingly, the concerned bank shall determine the tax liability and tax will be deducted at source. The concerned bank, which has deducted tax at source, shall issue a certificate in this regard

A new Section 112A is proposed to tax LTCG on gain on transfer of listed equity shares @ 10%, for gains in excess of Rs. 1 lakh. This provision is applicable from April 1, 2018. (surcharges will be applicable as per slabs)

Bank is required to deduct tax from the capital gains on sale of shares at specified rates of 15% (plus Health and Education Cess @ 4%) on short-term capital gains. (surcharges will be applicable as per Tax slabs)

FEMA provisions allow Indian companies to issue Rights / Bonus shares to existing non-resident shareholders, subject to adherence to sectoral cap as may be applicable.

Cost of acquisition of bonus shares is taken as zero hence the capital gain on selling a bonus share is equal to its selling price and the period of holding is computed from the date of allotment of such bonus shares.

Yes, as an NRI you can receive shares in inheritance. RBI permission is not required to be obtained and the shares will be held on non-repatriable basis in NRO Demat account.

Below is the list of documents required in case of transfer of NRE PIS account
1. No objection certificate from erstwhile PIS service provider
2. Holding Statement with rate, date, quantity and company Name with ISIN
3. Holding Statement to mentioned clearly the mode of acquisition is from NRE or NRO

Yes, we suggest you to update the details post account opening and periodically match the holding in your Demat account with bank details.

We suggest you to please provide the detail in Holding declaration format to Bank for IPO and corporate action. Bank needs to update the cost and date of acquisition against each share to follow FIFO method for Tax calculation.

Yes, through NRO account. Please approach you SEBI Registered Broker for more details.

No, currently we have empanelment with Zerodha Broking Limited for opening of NRI demat and trading account. We are looking forward to add more SEBI registered brokers. You can reach out to your NRI RM or nearest IDFC FIRST Bank branch for more details.

You can refer below link for more details on NRI offering from Zerodha Broking Limited

https://support.zerodha.com/category/account-opening/nri-account-opening/articles/how-to-open-an-account-as-a-nri