Investing in India after you move back
Your Indian investments were set up for an NRI. Once you're resident they need updating, and new options open up. Here's what to change and what to consider.
The short version
Update every account
- Banks, brokers and fund houses must know you're resident
- NRI accounts can't be kept after you move back for good
- Do it in the first few months
New options open up
- Some savings schemes are only for residents, such as PPF
- Resident accounts are simpler and cheaper
- Fewer limits on what you can buy
Keep it simple
- Index funds, a few good funds, deposits and a little gold
- Avoid products that mix insurance and investment
- Know the tax before you buy
What to update
| Account | What to do |
|---|---|
| NRE and NRO accounts | Ask the bank to change them to resident accounts; foreign currency can go to an RFC account. |
| Demat and trading (PIS) accounts | Open a resident demat and trading account and move your shares to it; close the NRI (PIS) accounts. |
| Mutual funds | Update your residential status and bank account with each fund house, or through CAMS and KFintech, which handle most funds. |
| KYC records | Update your address and status in your KYC record, with a resident bank account and Indian address proof. |
| Insurance and pensions | Update your address and status with insurers, and with the National Pension System (NPS) if you have it. |
Where returnees commonly invest
| Good for | Tax (as of 2026) | |
|---|---|---|
| Equity index and mutual funds | Long-term growth | Gains after 1 year: 12.5% above ₹1.25 lakh a year; within a year: 20% |
| Debt funds and fixed deposits | Steady money for the next few years | Interest and gains taxed at your slab rate |
| PPF (Public Provident Fund) | Safe, long-term, residents only | Interest and withdrawals tax-free; ₹1.5 lakh a year limit |
| Senior Citizens' Savings Scheme | Regular income for people aged 60 or more | Interest taxed at your slab rate |
| NPS | Retirement savings with low costs | Part can be taken tax-free at 60; the rest buys a pension |
| Gold (funds or ETFs) | A small share, as a hedge | Gains after 1 year (ETFs) or 2 years (funds): 12.5% |
Tax figures are for residents and can change in any budget. Equity covers funds that hold mostly Indian shares.
Good to know
- Keep part of your money in foreign currency or global funds, so a falling rupee doesn't cut your savings.
- Be wary of insurance-plus-investment plans (endowment plans and many ULIPs): costs are often high and returns low. Buy term insurance and invest separately.
- Use your RNOR years to sell or reorganise investments abroad while income abroad is generally not taxed in India; see Your first year of taxes back.
US citizens and green card holders: the US taxes you wherever you live, and treats Indian mutual funds and ETFs as "PFICs", with harsh tax and heavy paperwork. Many prefer Indian shares held directly, deposits and PPF. Check with a US tax adviser before you buy Indian funds.
Questions
Do I have to close my NRI demat account after moving back?
Yes, it has to be converted. Open a resident demat and trading account, move your shares across, and close the NRI accounts. Your broker can guide you.
Can I open a PPF account after moving back?
Yes. PPF is open to residents, so you can open one once you're resident in India.
Can I keep my investments abroad?
Yes. Investments you made while you were an NRI can stay abroad. Once you're ordinarily resident, their income is taxable in India and they must be reported in your tax return.
Do I need to tell my mutual fund house I've moved back?
Yes. Update your residential status, address and bank account with each fund house or through CAMS and KFintech, so tax is deducted correctly and payouts reach your account.
What's a simple portfolio for a returning family?
Many keep a few years of spending in deposits and debt funds, most of the rest in low-cost Indian and global index funds, and a small share in gold. The mix depends on your age and plans.