Regulations 1 to 4 explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.
Regulation 3 of the Foreign Exchange Management (Remittance of Assets) Regulations, 2016 bars every remittance outside India of an asset held in India, unless the law allows it. Regulation 4 then opens a door for four groups of foreign nationals and for Non-Resident Indians and Persons of Indian Origin, up to USD 1,000,000 per financial year, on documents. Regulation 7 sends larger amounts and hardship cases to the Reserve Bank, and regulation 8 reminds the remitter that tax laws apply. This article reads regulations 1 to 4(2), 7 and 8, with the Master Direction - Remittance of Assets.
This article states the position as the Regulations were notified on 1 April 2016 (Notification No. FEMA 13 (R)/2016-RB), with every limit and document as the Master Direction - Remittance of Assets prints it, "updated as on June 29, 2026". The Master Direction's Appendix lists no amendment of the Regulations themselves. Later changes should be checked. The Regulations are made under section 47 of the Foreign Exchange Management Act, 1999, in supersession of the 2000 regulations; see our article on sections 47 and 48 of the Act. For a remittance from India by an NRI or a foreign national, our NRI tax filing service covers the tax certificates that go with it.
No person, resident in India or not, may remit any asset held in India unless the law allows it (regulation 3). Four groups of foreign nationals, and NRIs and PIOs, may remit up to USD 1,000,000 per financial year through an authorised dealer on documentary evidence. Above that figure, or in a case of hardship, the Reserve Bank's prior permission is needed (regulation 7). All instalments of a remittance in a year must go through the same authorised dealer. Every remittance is subject to Indian tax laws (regulation 8).
Regulations 1 and 2: title and definitions
Regulation 1 gives the title and says the Regulations came into force on the date of publication in the Official Gazette. Regulation 2 defines the terms. The preamble says the Regulations are made "in supersession of Notification No. FEMA 13/2000-RB dated May 3, 2000".
| Term | Meaning |
|---|---|
| Authorised Dealer | A person authorised under sub-section (1) of section 10 of the Act |
| Non-Resident Indian (NRI) and Person of Indian Origin (PIO) | Same meanings as in the Foreign Exchange Management (Deposit) Regulations, 2016 |
| Remittance of asset | Remittance outside India of funds representing a deposit with a bank or a firm or a company, provident fund balance or superannuation benefits, amount of claim or maturity proceeds of insurance policy, sale proceeds of shares, securities, immovable property or any other asset held in India in accordance with the Act or rules or regulations under it |
The Master Direction - Remittance of Assets, updated as on June 29, 2026, gives its own versions of NRI (a person resident outside India who is a citizen of India) and PIO (a person resident outside India who is a citizen of any country other than Bangladesh or Pakistan or such other country as the Central Government may specify, satisfying listed conditions of Indian descent or marriage, and including an Overseas Citizen of India cardholder) in its paragraphs 2.2 and 2.3. These are the Master Direction's words, not the Regulations'. The Master Direction's Introduction still refers to Notification No. FEMA 13/2000-RB, the repealed 2000 regulations; its cover note refers to the 2016 Regulations. Check the current instruments.
Regulation 3: the prohibition
"Save as otherwise provided in the Act or rules or regulations made or issued thereunder, no person, whether resident in India or not, shall make remittance of any asset held in India by him or by any other person." The proviso says the Reserve Bank may, for sufficient reasons, permit any person to make remittance of any asset held in India by him or by any other person.
Regulation 4(1): foreign nationals
A citizen of a foreign state, not being a PIO or a citizen of Nepal or Bhutan, who:
- (i) has retired from an employment in India; or
- (ii) has inherited the assets from a person referred to in sub-section (5) of section 6 of the Act; or
- (iii) is a widow or widower resident outside India and has inherited assets of the deceased spouse who was an Indian citizen resident in India,
may remit through an authorised dealer an amount "not exceeding USD 1,000,000 (US Dollar One million only) per financial year on production of documentary evidence in support of acquisition, inheritance or legacy of assets by the remitter". Section 6(5) of the Act is explained in our article on section 6(4) to (6) of the Act.
Two provisos: for arriving at the annual ceiling, funds representing sale proceeds of shares and immovable property owned or held by the foreign citizen on repatriation basis, under the "Foreign Exchange Management (Acquisition and transfer of immovable property in India) Regulations, 2016" and the "Foreign Exchange Management (Transfer or issue of security by a person resident outside India) Regulations, 2000" as printed, shall not be included; and where the remittance is made in more than one instalment, all instalments shall go through the same authorised dealer. Those two instruments are named as printed; check the current instruments, since the Non-debt Instruments Rules, 2019 govern investment by non-residents in India today.
Clause (iv): a person who came to India for studies or training and has completed them may remit the balance available in the account, provided the balance represents funds derived out of remittances from abroad through normal banking channels, or rupee proceeds of foreign exchange brought by such person and sold to an authorised dealer, or stipend or scholarship received from the Government or any organisation in India. Clause (iv) follows the two provisos in the printed text and has its own wording; it speaks of "the balance available in his account" and prints no dollar figure. The Master Direction (paragraph 3.1) lists it as a separate case for a foreign student who has completed his or her studies.
The Master Direction (paragraph 3.1) states the same four cases, adds that the one million dollar limit "will not cover sale proceeds of assets held on repatriation basis", and says: "These facilities are not available for citizens of Nepal or Bhutan or a PIO."
Regulation 4(2): NRIs and PIOs
An NRI or a PIO may remit through an authorised dealer an amount "not exceeding USD 1,000,000 (US Dollar One million only) per financial year":
| Clause | Source of funds |
|---|---|
| (i) | Balances held in Non-Resident (Ordinary) Accounts (NRO accounts) opened under the Deposit Regulations, 2016, sale proceeds of assets, or assets acquired by inheritance or legacy, on production of documentary evidence |
| (ii) | A deed of settlement made by either of his parents or a relative (as defined in section 2(77) of the Companies Act, 2013), the settlement taking effect on the death of the settler, on production of the original deed of settlement |
Two provisos again: all instalments through the same Authorised Dealer; and, where the remittance is from NRO balances, the account holder shall give an undertaking to the Authorised Dealer that "the said remittance is sought to be made out of the remitter's balances held in the account arising from his/ her legitimate receivables in India and not by borrowing from any other person or a transfer from any other NRO account", failing which the account holder renders himself or herself liable for penal action under FEMA.
The Master Direction (paragraph 3.2) restates this, adds that the remittance may include transfer to NRE and SNRR accounts, and says, as its own direction, that a settlement made without retaining any life interest, during the lifetime of the owner or parent, amounts to a regular gift and the remittance of sale proceeds of such property is guided by the instructions on remittance of balance in the NRO account. For the account features see our articles on NRO account, tax and repatriation and on NRI property sale proceeds.
Regulation 7: Reserve Bank's prior permission
A person may apply to the Reserve Bank in two cases:
- Remittance exceeding USD 1,000,000 per financial year: (a) on account of legacy, bequest or inheritance to a citizen of a foreign state resident outside India; and (b) by an NRI or PIO out of NRO balances, sale proceeds of assets or assets acquired by inheritance or legacy.
- Hardship: remittance to a person resident outside India on the ground that hardship will be caused to such a person if remittance from India is not made.
On consideration of the application, "the Reserve Bank may permit the remittance, subject to such terms and conditions as it deem necessary". The Regulations name no timeline or procedure for the application, and none is given here. The Master Direction (paragraph 4) repeats the two cases and adds in paragraph 4.2, as its own direction, that remittance of funds from the sale of assets in India held by a person, whether resident in or outside India, not covered by the permitted cases requires approval of the Reserve Bank.
Regulation 8: tax
"Any transaction involving remittance of assets under these regulations shall be subject to the applicable tax laws in India." The Master Direction (paragraph 5) adds that the Reserve Bank will not issue instructions under FEMA clarifying tax issues and that authorised dealers must comply with tax laws. For tax certificates and returns of NRIs, see our income-tax guides and our NRI tax filing service.
A worked example
Hector Vance, a foreign citizen who is not a PIO, retired from a job in India and wants to send home retirement savings. Regulation 4(1)(i) lets him remit up to USD 1,000,000 in the financial year through an authorised dealer on documentary evidence, with all instalments through the same dealer. Separately, Meera Bhatt, an NRI, wants to send her NRO balance, which includes money inherited from her mother: regulation 4(2)(i) lets her remit up to the same ceiling after giving the undertaking that the funds are her legitimate receivables and not borrowed. If she wanted to send more in the same financial year, regulation 7 would require the Reserve Bank's prior permission. The names are invented.
Need help with a remittance from India?
The documents, the undertaking and the choice between the authorised dealer route and an application to the Reserve Bank all depend on the source of the funds and the status of the remitter. Our NRI tax filing team can prepare the tax side while the FEMA route is settled.
Key takeaways
- Regulation 3 bars remittance of assets held in India unless the law or the Reserve Bank allows it.
- Foreign nationals (retired, inherited, widow or widower, student) and NRIs or PIOs may remit up to USD 1,000,000 per financial year through an authorised dealer.
- Same authorised dealer for all instalments; an undertaking for NRO remittances.
- Beyond the ceiling, and in hardship cases, the Reserve Bank's prior permission is needed.
- Tax laws apply to every remittance.
Read next
- Remittance by companies and on closure of offices: regulations 4 to 6
- Repatriation of property sale proceeds: rule 29 of the Non-debt Instruments Rules
- Repatriation of funds from India: rules and limits
- NRI accounts: NRE, NRO and FCNR
Disclaimer: Based on the Gazette text of the instrument this article names, as notified and as amended by the notifications named in the article (for the Foreign Exchange Management (Non-debt Instruments) Rules, 2019 the latest amendment consulted is S.O. 4870(E) dated 2 September 2026), as consulted on 2 October 2026. There is no official consolidated text; the provisions were read with each amendment applied. Sectoral caps, entry routes, conditions, forms and time limits change by notification, press note and circular; later changes should be checked on the Gazette, DPIIT and Reserve Bank sites. This article is general information, not legal advice; check the official text before acting.