Portfolio questions -nickray

[nickray]

I like this forum a lot.
It is very informative.
I have a couple of questions for the experts. I am an GC holder.
We had some money that we deposited in the post office MIS program which was advised by our family friend who is the head post master in the post office.
We inquired if NRI's could participate in this plan and he said it was perfectly fine. After reading all the posts on this forum, we realize that NRI's cannot participate in this. We are already 3 years into this now. If we withdraw we loose the interest. We did pay for it through our NRE account in India.
Now once the policy matures and we get the check how do we go about it. Can we depost it in our NRE account and repatirate it or do we have to deposit it in an NRO account we are not sure.

Similarly we have a life insurance polciy through Birla Sun life, which sucks since we were never made aware of the loading and administrative fees.
We are planning to exit the program in the next year or two since it will be 5 years since we started the policy. How do we repatirate the amount that we get once we surrender the policy.

The last question is we bought an apartment in 2001 for my parents.
Now they don't live in the apartment so we rented the apartment.
The problem is we did not have an NRE account back then and we used to send checks to my father who used to make the payments. It was only last year that we started making payments from our NRE account. If and when we sell the house can we show the link of US check to my fathers account and then being paid for the loan and can we repatirate the amount once we sell it by depositing the money in our NRE account.

Please advise.
Appreciate your time and response.

Thanks.
Bindu

[Desi]

I like this forum a lot.
It is very informative.
I have a couple of questions for the experts. I am an GC holder.
We had some money that we deposited in the post office MIS program which was advised by our family friend who is the head post master in the post office.
We inquired if NRI's could participate in this plan and he said it was perfectly fine. After reading all the posts on this forum, we realize that NRI's cannot participate in this. We are already 3 years into this now. If we withdraw we loose the interest. We did pay for it through our NRE account in India.
Now once the policy matures and we get the check how do we go about it. [/quote]When you say policy, life insurance comes to mind. Your investment is in Post Office MIS or POMIS. The POMIS pays monthly interest. After 3 years if you encash, you lose 1% of the amount, but your interest is 8% or so per year, so losing 1% is not that bad. You do not lose all the interest.

Also, even though NRIs cannot invest, it does not mean that if you already have an investment that you have to encash - so you can leave it as is or encash, the choice is yours. Go to Post Office website and check how much you will lose if you close account after 3 years and my understanding is that that amount is 1%.

[QUOTE]Can we depost it in our NRE account and repatirate it or do we have to deposit it in an NRO account we are not sure.

You cannot deposit it in the NRE account, the bank will not accept it. You have to deposit it in NRO account or gift the monthly interest to someone. The interest accrued in NRO account on the deposits will be subject to TDS (I think of 30%).

[QUOTE]
Similarly we have a life insurance polciy through Birla Sun life, which sucks since we were never made aware of the loading and administrative fees.
We are planning to exit the program in the next year or two since it will be 5 years since we started the policy. How do we repatirate the amount that we get once we surrender the policy.


Deposit in NRO account and read thru a couple of threads on repatriation that discuss how to repatriate NRO funds. You will find the links for repatriation threads in FVTs.

[QUOTE]
The last question is we bought an apartment in 2001 for my parents.
Now they don't live in the apartment so we rented the apartment.
The problem is we did not have an NRE account back then and we used to send checks to my father who used to make the payments. It was only last year that we started making payments from our NRE account. If and when we sell the house can we show the link of US check to my fathers account and then being paid for the loan and can we repatirate the amount once we sell it by depositing the money in our NRE account.
I doubt that a link like this would be accepted, but it is unnecessary. India allows transfer of monies from India to USA without having to show that the money was from outside India. Read the threads on repatriation and Money transfer from India in the FVTs.