Skip to main content

This is a new service – your feedback will help us to improve it.

Posted Mon, 06 Jan 2025 13:48:42 GMT by AJ89 AJ89
Hello HMRC team, I've below questions for Indian bank accounts NRO and NRE savings interest income declaration in self-assessment, please reply: 1. NRO savings interest tax paid as per Indian tax law and then refunded as per Indian tax allowances. As tax refunded in India, it is similar to NRE account interest where no tax is paid. Is it then correct to consider it under tax spared mechanism FTCR (15%) together with NRE interest income as per this link (https://www.gov.uk/hmrc-internal-manuals/international-manual/intm161270)? If India NRO interest income is not allowed under tax spared mechanism, can you please provide a document link mentioning clearly that only India NRE interest is claimable under tax spared mechanism? I understand that if the India tax paid on NRO interest was not refunded in India, I could have claimed that tax paid fully or up to 15% here in the UK. 2. NRO account is joint account with parent living in India. Is it allowed to split interest unequally with parent? Also, as per saim2420, to provide evidence for intention of unequal split, do I need to write a declaration of trust letter myself with these details and upload this while filing self-assessment or send separately? And what exact details must be included in the letter for both myself and my parent? Same question for NRE account which is joint account with spouse living in the UK. 3. NRO account was converted (keeping same account number but type of account changed) from the existing domestic account when NRE account was opened. The domestic account was opened >10 years ago whereas NRO account (after conversion) and NRE is under 10 years. Is it ok to consider NRO account interest under tax spared mechanism FTCR (15%) as NRO is under 10 years since conversion? 4. The NRO and NRE bank interest certificates mention two amounts, Interest paid/credited to account and Interest accrued for the given tax year. For calculating the total interest income for UK taxation for the given tax year, do I need to consider only interest paid or only interest accrued or both for the given year. This is important to understand to avoid possible double calculation of interest in different years. Please provide a document link mentioning clearly to help understand the rules. Kind regards.
Posted Wed, 22 Jan 2025 07:48:59 GMT by HMRC Admin 25 Response
Hi AJ89 AJ89,
1. Only NRE accounts qualify for this - DT9553 - India: Notes
2. As joint income you split 50/50
3. No as it is a different account
4. Interest paid in the tax year is what you declare. The accrued amount is the running total still to be added.
Thank you. 

You must be signed in to post in this forum.