Non-Repatriable Demat Account

A non-repatriable Demat account is generally linked to an NRO bank account and is used by NRIs to hold eligible Indian securities on a non-repatriation basis. Funds from the account cannot be freely transferred outside India.

• It is generally linked to a Non-Resident Ordinary (NRO) account.
• It can hold eligible shares, bonds, and other securities in electronic form.
• NRO funds and investment proceeds are not freely repatriable.
• Eligible NRO balances and sale proceeds can be remitted up to approximately ₹9.52 crore (USD 1 million) per financial year, subject to applicable conditions.
• Applicable taxes must be paid before eligible funds are remitted abroad.

A non-repatriable Demat account allows a Non-Resident Indian (NRI) to hold eligible securities in India on a non-repatriation basis. It is commonly linked to a Non-Resident Ordinary (NRO) bank account.
An NRO account is generally used to manage income and funds earned or held in India. The linked Demat account can hold eligible shares, bonds, and other financial securities in electronic form.
The term “non-repatriable” means that money from these investments cannot be freely transferred outside India. However, eligible NRO balances and investment sale proceeds may still be remitted abroad after meeting applicable tax, documentation, and regulatory conditions.
Annual remittance limit: Approximately ₹9.52 crore (USD 1 million) per financial year.
If an Indian resident moves abroad and becomes an NRI, their existing Demat account needs to be updated according to their new residential status. Their investments can then be held through the appropriate NRI Demat account.
An individual NRI’s investment in the equity shares of an Indian company is also subject to applicable investment limits. These limits depend on the investment route and relevant regulations.
 

Suppose Ajay is a retired Indian resident who moves to the US to live with his daughter. After moving abroad, his residential status changes to NRI.
Ajay already has investments in India worth ₹1 crore. His investments now need to be maintained through accounts appropriate for his NRI status.
Suppose Ajay sells some investments and receives ₹50 lakh. Since the investments are held on a non-repatriation basis, he cannot freely transfer this entire amount to his US bank account.
Eligible funds may still be remitted overseas after meeting applicable tax and documentation requirements.
Annual remittance limit: Up to approximately ₹9.52 crore (USD 1 million) per financial year for eligible NRO balances and sale proceeds.
This is why repatriable and non-repatriable investments are handled separately. Different rules apply to how the proceeds from these investments can be transferred abroad.
 

A repatriable Demat account allows NRIs to hold eligible investments in India on a repatriation basis. This means eligible investment proceeds can be transferred outside India, subject to applicable rules.
Such a Demat account is generally linked to an NRE (Non-Resident External) bank account. Eligible funds held in an NRE account can be repatriated abroad.
For example, if an NRI invests using eligible repatriable funds and later sells those investments, the proceeds can generally be transferred outside India after meeting applicable requirements.
 

Both repatriable and non-repatriable Demat accounts can be used by NRIs to hold securities in India. The main difference is how easily the investment funds and sale proceeds can be transferred outside India.

Here are the key points about a non-repatriable or NRO-linked Demat account:

• NRO linkage: The Demat account is generally linked to an NRO bank account for non-repatriable transactions.
• Separate treatment: Repatriable and non-repatriable investments are handled separately.
• Fund transfer: Money held in an NRO account is not freely transferable abroad.
• Eligible remittances: Certain balances and investment sale proceeds may still be remitted overseas after meeting applicable requirements.
• Annual limit: Eligible remittances can be up to approximately ₹9.52 crore (USD 1 million) per financial year.

• Taxes: Applicable taxes must be paid before eligible funds are remitted overseas.

  
  
  

A non-repatriable Demat account allows NRIs to hold eligible Indian securities on a non-repatriation basis. It is generally linked to an NRO account, and funds held through it cannot be freely transferred outside India.
However, eligible NRO balances and investment sale proceeds may still be remitted abroad after meeting applicable requirements. The annual remittance limit is approximately ₹9.52 crore (USD 1 million) per financial year, subject to applicable taxes, documentation, and regulations.