NRE vs NRO Account: Which One for Property Purchase?

The Direct Answer

NRE (Non-Resident External) = Money you earned abroad. It is fully repatraible. Use this to BUY property. NRO (Non-Resident Ordinary) = Money earned in India (Rent, Dividends, Sale Proceeds). Use this to RECEIVE funds (Rent/Sale).

Comparison Table

| Feature | NRE Account | NRO Account | | :--- | :--- | :--- | | Source of Funds | Foreign Income (USD/GBP/AED) | Indian Income (Rent/Sale Proceeds) | | Repatriability | Freely Repatriable (No limits) | Restricted ($1M USD / year) | | Tax on Interest | Tax-Free in India | Taxable at ~30% | | Joint Account | With another NRI only | With Resident Indian (Former or Survivor) | | Best Use | Parking Savings / Buying Home | Collecting Rent / Paying Bills |

Common Scenarios

• Buying a Flat: Transfer Dollars -> NRE Savings -> Write Cheque to Builder.
• Collecting Rent: Tenant transfers INR -> NRO Savings.
• Selling a Flat: Buyer pays INR -> NRO Savings -> You repatriate to Foreign Account.
• Paying Home Loan: Can pay from NRE or NRO (but preferable to pay from NRE to keep Repatriability intact).

Can I transfer money between them?

• NRE -> NRO: ✅ Yes, Allowed freely.
• NRO -> NRE: ❌ Restricted. Requires 15CA/15CB certificates (proof of tax payment).