Conversion to NRI account

Few queries on conversion into NRO linked account from existing resident account in Zerodha, if someone can please help in the clarification:

I have ICICI account as primary bank account, but going through various links it doesn’t seem to be supported as NRO account. Is this still valid and do I need to open NRO account from the supported bank list?
Also lets say I open a new bank account, do I need to link it first with Zerodha and then ask for conversion or it can be done together as part of conversion?
What is the difference between PIS & non-PIS account and which one is needed?
As per my understanding this conversion will be like closing existing account and opening new one? Correct?
Will there be any taxation involved in conversion?
Does it affect existing login information?
How will the purchase price of my holdings be reflected post conversion?

Can this entire conversion be done before moving abroad and what all documents will be needed to support this in that case?

@AkshayAtur can you.

We’re now live with the non-PIS route {NRO account} where we’re supporting any bank of your choice. It doesn’t have to be only from the list of supported banks {PIS}.

The conversion and linking a new account will be a single process. You needn’t first change the bank, it’ll be part of this conversion {resident to NRI}.

Earlier trading through NRO also required a PIS account & Permission {here banks handle the reporting/settlement and do the taxation (STCG/LTCG)}. There was a significant cost overhead for this. RBI sometime ago {2017} brought in some changes in the FEMA regulations that allowed NRIs to trade in the secondary markets without the need of a PIS through the NRO account and also removed this reporting restriction {Depositories}. However, there was still a catch here. Similar to how the banks did the taxation the broker is now responsible for doing the taxation to remain compliant with the Income Tax act.

Yes, that’s correct. However, we’ll not close the demat account, that’ll be converted to NRO {Non-Repatriable} status and your resident trading account will be closed. You’ll receive a new login ID through which you’ll trade that will be linked to the same demat {converted}.
Nope, no taxation here.

We wouldn’t have carried over the trades made on the older account {resident}. So, you’ll have to update the buy averages for the holdings. The process is explained here

Please write to [email protected] and someone from the team will connect and assist you with the process.


Thanks @AkshayAtur , quite informative. One relief that one need not worry on changing the bank account. : )
One more question on this, will the CDSL details of my account also change with this or those remains the same?

Like I explained earlier, only the trading account will be closed. The demat account will remain the same {no movement of shares, etc.}. The only change will be that the demat account is changed to NRI {NRO} status.

Here’s what you’ll be able to see on the CMR copy of the converted demat, just so that you have an idea:

  • If you’ve nominated someone - It’ll say NRI Non-Repatriable in the BO Sub Status

But, you’ll need to inform the bank {ICICI} to convert the account to NRO {if not done yet}. Otherwise, yep - no need to change the bank. If you hold an NRO account already with ICICI > As explained, this is now possible through the non-PIS route.

1 Like

Thanks @AkshayAtur once more, I have still some time left to move out. Will check with both ICICI and Zerodha teams as you have mentioned to see how it can be completed before the move.

@AkshayAtur @ShubhS9 @Quicko
Got confused over some points for NRO accounts, if someone can please help in understanding.

So in NRO we can deposit both income earned in India as well as income form foreign country, correct?
At some place it was mentioned that both principal and interest are to be taxed at 30% for NRO. Can someone please help on this with some practical scenarios ?

What is meant by Principal is taxable at 30% ?

Yes, you can deposit income accrued in India {Rent, dividend, etc} and also transfer from a foreign country.

Interest income from a non-resident ordinary rupee (NRO) account is fully taxable in India. Not the ‘Principal’
This income {interest} is also subject to TDS—30% (plus surcharge and cess) on payments made to NRIs. The bank will deduct TDS on interest paid on an NRO account.

Would suggest you reach out to the bank who can clarify further as they’re responsible for the TDS for NRI accounts.