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I am a Indian citizen. I am going to work in UK for some years. I am looking a best way to send my earned money to india. the options are,

1) Saving the whole money in UK and get back all in a bulk, while returning to india(say after 2 years).

2) Sending the money to india on every month as a small amount

Which is the best option? is there any practical difficulties/TAX issue in the above 2 options?

Thanks in advance.

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There is no difference in taxation in India if you transfer every month or bulk.

If you use specialized remittance services from leading Indian Banks, there would be little difference in fees.

Assuming you are keeping the funds in NRE account in India and hold it in GBP, you get a slight better rate of interest that what you would get in UK. The interest would not be taxable in India, however it would be in UK.

If you convert the funds at hold it in NRE, Rupee account, you would get still better rate of interest. However you are taking the Fx risk when you try and convert this back to GBP incase you decide to stay on.

There are no right or wrong answers

Edit:
There is no limit on the amount of funds earned as NRE that can be got into India tax free. There is a time limit of 7 Years to get the funds back to India tax free. From a tax point of view if you transfer into NRE account its easy. If you transfer into Normal Savings account you would need some paperwork.

  • Dheer, Thanks for your answer. is there any limit for bulk transfer? Do i need to worry about tax for that money? If i deposit in NRE or normal Savings account. – Amarnath Thangaraj Nov 22 '14 at 7:36

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