NRO Account (Non-Resident Ordinary Account)
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An NRO (Non-Resident Ordinary) account is an Indian bank account for holding an NRI's income that arises in India -- rent, dividends, pension, or sale proceeds of property, for example -- where interest is taxable in India and repatriation abroad is subject to the RBI's USD 1 million-per-financial-year limit and Form 15CA/15CB certification.
Unlike an NRE account, an NRO account can hold both foreign remittances and India-sourced income, which
makes it the correct account for proceeds an NRI receives from selling inherited or purchased property in
India, rental income from an Indian property, or dividends from Indian investments. Interest earned in an
NRO account is subject to TDS at the applicable rate, and any balance an NRI wants to move abroad must go
through the RBI's remittance facility, capped at USD 1 million per financial year, backed by a Chartered
Accountant's Form 15CA/15CB certification confirming applicable taxes have been paid. This is the single
biggest practical difference from an NRE account, whose balance is freely repatriable without that cap.
