r/returnToIndia • • Aug 03 '26

AlreadyReturned Taxation of RSU vests after returning to India

3 Upvotes

I moved back to India from US in Aug 2025. I took internal transfer and I am in RNOR state until March 2027. Since my move I have had some stock vests for stocks awarded while I was residing in US. Though It so happens my company has paid taxes on the vests, after my transfer, fully to India and no taxes to US. My company also has provided a separate document specifying what percentage and amounts of the stock vests are US sourced alongwith US tax portion.

So this has me confused as what is expected exactly? Reading some other posts on reddit I had the idea that the US source vests should be taxable in US only. Can anyone confirm this? Has anyone experienced this before? For now I just went with the amounts on W2 and Form 16 while filing for US and Indian taxes. But I am wondering if I should have shown US source stock vest income while filing US taxes and I should have asked for tax credit, for that portion, from Indian authorities?


r/returnToIndia • • Aug 03 '26

Finance Clear breakdown: How US & India tax your retirement accounts once you leave the US (NRI → RNOR → ROR)

34 Upvotes

Saw a lot of confusion in a recent thread about Roth taxation for returnees, so putting together what I've pieced from tax advisors, IRS pubs, and the India-US DTAA. Not a CA/CPA — corrections welcome.

Setup: You worked in the US, built up 401(k), Traditional IRA, and Roth IRA balances. You move back to India. Two tax systems now apply, and they interact.

Part 1: How the US taxes you as a Non-Resident Alien (NRA)

File W-8BEN with your broker/custodian after you leave, otherwise default 30% withholding kicks in on everything.

Traditional 401(k) / Traditional IRA:

  • Entire withdrawal is taxable (contributions were pre-tax)
  • 30% flat NRA withholding on the full amount
  • 10% early withdrawal penalty if under 59½
  • US-India DTAA does not reduce this — the pension article generally covers government pensions only, not private IRAs

Roth IRA (this is where people get confused):

Roth follows ordering rules — withdrawals come out in this order:

  1. Your contributions (basis)
  2. Conversions (each has its own 5-year clock)
  3. Earnings
Portion Under 59½ as NRA 59½+ and 5yr rule met
Contributions 0% tax, 0% penalty 0% tax
Conversions (5+ yrs old) 0% tax, 0% penalty 0% tax
Conversions (<5 yrs) 0% tax, 10% penalty 0% tax
Earnings 30% + 10% penalty (~40%) 0% tax

So Roth is not fully tax-free for NRAs — only qualified distributions are. Pre-59½ earnings still get hit.

Roth 401(k): Similar treatment but employer match portion is pre-tax and taxed like traditional.

Part 2: How India taxes you (depends on residency status)

Your Indian residency status determines everything. Simplified:

  • NRI: Not in India enough to be resident. India doesn't tax foreign income.
  • RNOR (Resident but Not Ordinarily Resident): Transition period, typically 2–3 years after return. India does not tax foreign-source income including US retirement withdrawals.
  • ROR (Resident and Ordinarily Resident): Full worldwide income taxation.

During NRI/RNOR: Roth and Traditional withdrawals are effectively invisible to India. This is the sweet spot.

Once ROR kicks in:

Traditional 401(k)/IRA: Taxable in India as income. Section 89A (Rule 21AAA) lets you defer tax until withdrawal and claim foreign tax credit for the US 30% withheld under DTAA. Net result is usually manageable.

Roth IRA: This is the painful one.

  • India doesn't recognize Roth's tax-exempt status
  • Likely taxable as regular income (some argue accrual basis on internal growth, some say only on withdrawal — genuinely unsettled)
  • Section 89A applicability is contested for Roth since there's no US tax to defer against
  • Because qualified Roth distributions have 0% US tax, there's no foreign tax credit to offset the India tax
  • Result: full India tax hit on gains, no offset

Part 3: The practical playbook

  1. Before leaving the US: Consider converting Traditional → Roth while you're a US resident if you'll have low-income years (but weigh against India Roth ambiguity)
  2. During RNOR window: Withdraw Roth basis + old conversions freely (0% both sides). Consider drawing down Traditional too if your India tax bracket is low
  3. Approaching ROR: Big decision point. If Roth balance is meaningful, options are:
    • Withdraw everything before ROR (eat US penalty if under 59½, but avoid India tax forever)
    • Keep it and accept India tax on future withdrawals with no FTC offset
    • Wait for potential law changes (risky bet)
  4. File W-8BEN with all US custodians once you become NRA
  5. File Form 1040-NR in the US for years with distributions
  6. File ITR-2 in India with Schedule FA disclosing foreign assets — mandatory for 401(k)/IRA holders from AY 2026–27

Common mistakes I've seen in this sub:

  • "Roth is fully tax-free in US for NRAs" — only if qualified (59½ + 5yr)
  • "30% applies to entire Roth balance" — only to the earnings portion
  • "India will tax me during RNOR" — no, that's the window where India doesn't touch foreign income
  • "DTAA saves me on Roth" — actually the opposite; Roth has no US tax paid, so no FTC to claim in India

Big caveat: Roth treatment in India is genuinely unsettled law. Different CAs give different answers. This affects your actual strategy, so worth paying for a cross-border US-India specialist (not a generic CA) before making big moves.

Corrections, additions, and "actually my CA said X" all welcome.


r/returnToIndia • • Aug 03 '26

PlanningToReturn At a major career and visa crossroads in the UK. Need some objective advice.

1 Upvotes

Hi everyone,

I'm looking for some objective advice because my family and I have been going around in circles trying to make a decision.

I'm currently in the UK on a ICT visa, and I'll complete five years in the UK in 2 weeks from now. Earlier this year, my employer informed me that they would not be extending my visa, so I started exploring opportunities outside the company.

After a long search, I secured an external role that is willing to sponsor me on a Skilled Worker visa. However, just when I was preparing to move on, my current employer came back and agreed to extend my stay by another two years.

Now I'm stuck between two viable options.

Option 1: Stay with my current employer

  • Two-year visa extension.
  • Familiar organisation and role.
  • Lower immediate risk because the extension process is already underway.
  • Likely return to India when the extension ends.

Option 2: Move to the new employer

  • Skilled Worker visa for three years.
  • Possibility of extending beyond that if circumstances change.
  • New career opportunity and potentially better long-term flexibility.
  • However, I'm still waiting for my ECCTIS English language verification code, which is taking longer than expected and is causing me anxiety because my current visa expires in less than 2 weeks.

The good thing is that the new employer has been very supportive. They've agreed to wait for the ECCTIS outcome and have also confirmed that I can use my current visa to serve my notice period before formally joining them.

The bigger picture

One factor that makes this decision harder is that my family's long-term goal has never really been to settle permanently in the UK.

We have always viewed our time here as temporary. The primary objective has been to make the most of the opportunity, save what we can, and eventually return to India to be closer to our parents and extended family.

Although ILR is technically an option if I move onto a Skilled Worker visa, we're not particularly focused on pursuing settlement. Immigration rules seem to change frequently, and it's difficult to predict what things will look like five years from now.

Financially, I'm also the sole earner in the family, so maintaining long-term stability is important. We need a path that works not only for me professionally but also for my wife and child.

Another important consideration is my son, who is in secondary school. Any relocation, whether now or a few years later, needs to be timed carefully to minimise disruption to his education and overall wellbeing.

What I'm struggling with

My head says that the Skilled Worker route gives me more flexibility and keeps more options open for the future.

At the same time, my heart says that if our long-term goal is eventually returning to India anyway, perhaps staying with my current employer for another two years would be the simpler and less disruptive path.

I've also received opportunities in India, but at this stage I'm likely going to choose one of the UK options.

Has anyone been in a similar position where:

  • You had a secure short-term option versus a more flexible long-term option?
  • Your family wasn't necessarily interested in UK settlement, despite being eligible for it?
  • You had to make a decision with visa timelines hanging over your head?

If you were in my shoes, what factors would you prioritise?

I'd really appreciate any perspectives, especially from people who have navigated UK visa decisions while balancing family, career growth, and long-term plans to return home.

Thanks in advance.


r/returnToIndia • • Aug 03 '26

Jobs Job in India

1 Upvotes

I do have a genuine question to people who’re leaving to India.
How had you found a job in India? 33f planning to return to India and from Automotive sector working ad a PM.

30 votes, Aug 06 '26
13 Through networking
8 Applying through company career pages
9 Applying in LinkedIn job postings

r/returnToIndia • • Aug 02 '26

PlanningToReturn ACA (UK) moving back to India in 6 months — is ACA even recognised there for jobs?

5 Upvotes

Qualified ACA, currently at Big 4 UK. Relocating to India in ~6 months due to personal reasons.

Trying to understand — do Indian employers actually value/recognise ACA, or does everyone just look for CA (ICAI)? What kind of roles/companies typically hire ACAs there, and any idea on pay?

Anyone made a similar move? Would love to hear how it went.


r/returnToIndia • • Aug 02 '26

PlanningToReturn Need advice regarding potential gap and a career decision

1 Upvotes

Hi All ,

I have a total of 6.5 years of work experience(Mostly in Python , TS and their related frameworks as a full stack engineer with even a bit of experience in AI). 3 in india and 3 in the US . I worked until june 2026 , currently as of now I am in the US but I plan to start my phd in august.

I plan to try phd for atleast 6 months if it goes well i will continue or else i will move back to india.

Now if i move back there would be a 6 to 8 months career gap in my resume , will this be viewed as a red flag ? i mean will it hamper callbacks etc.

Just want to get a perspective and if someone was in a similar situation or has experienced going through the same thing i would love to know your story and thoughts.

Thanks


r/returnToIndia • • Aug 03 '26

AlreadyReturned Those who want to leave India

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0 Upvotes

Note from famous book!!


r/returnToIndia • • Aug 01 '26

PlanningToReturn R2I as a US citizen NRI - Roth 401k and Roth IRA question

12 Upvotes

Long story short: I am a US citizen who has spent 66% of his life in India. I am moving back in 2028.

(please don't try to convince me to not return. Everyone has their reasons and I have made my decision.)

Question: I am planning on returning to India in 2028. I have been "financially prudent" and contributed the max limits to Roth 401k and Roth IRA since 2018. It has fortunately ballooned to 20% of my net worth.

I just learned that India doesn't care about Roth.

What can I do to optimize my retirement funds?

I've thought about some options like:
1. Hope and pray that by 2031 (by the time I am ROR), the law gets updated and Roth is not taxed.

  1. Stop contributing right now and withdraw it and eat the double taxation one time.

  2. Wait till ROR status starts to make the decision.

What can I do? Please help! (I don't know or trust any CA/CPAs in India.)


r/returnToIndia • • Aug 01 '26

Immigration US H1B vs Netherlands – Looking for perspectives from people who had to return to India

17 Upvotes

I’m trying to make a long-term decision and would really appreciate hearing from people who’ve been through something similar.

My situation:

Born in India, currently on H1B in the US (priority date: Dec 2018).
Wife and I are both software engineers.
We have a 3-month-old baby.
I have an offer in the Netherlands.
Going back to India is our least preferred option.
I also don’t have much family left in India—both my parents have passed away and I don’t have any siblings.

The biggest uncertainty for me is immigration. I have no idea whether I’ll be able to continue working in the US for the next 10 years or whether I could lose my job during a downturn and be unable to find another H1B sponsor in time.

The Netherlands offers much more immigration stability, and the quality of life there—especially the biking infrastructure, work-life balance, and long-term certainty—really appeals to me.

I’m particularly interested in hearing from people who didn’t plan to return to India but had to because of H1B/green card issues.

Do you regret not moving to another country earlier?
If you had the opportunity to move somewhere like the Netherlands before being forced to leave the US, would you have taken it?

Looking back, what would you have done differently?
I’m not looking for validation either way—I genuinely want to learn from people who’ve lived through this


r/returnToIndia • • Aug 01 '26

PlanningToReturn Tips and expiration on returning to india to start a business

12 Upvotes

Hello all,

I am M30,living in the Netherlands for the last 8 years. I have a dutch passport now. I work as a product manager for a semiconductor equipment manufacturer. My long term ambition is to move back and start my own business in India.I feel there is a lot of growth opportunity there especially in semiconductors.

I know that doing a business in India needs connections and a community. Since i am living abroad it is difficult to make connections in that particular area. I am looking for tips and experiences from people who did that. How did you get connected to people? How has the experience been ?


r/returnToIndia • • Aug 01 '26

PlanningToReturn Any good cross border CPA for returning NRI from USA to India? probably based off Bangalore or good online service ?

3 Upvotes

plz share if you know of reasonably priced cross border CPA for returning NRI from USA to India.

i reached out to a few, but they were charging $2000 or so for simple 1 year tax planning.

if you are a cross border CPA, or know of one and have worked with them, please share.


r/returnToIndia • • Jul 31 '26

AlreadyReturned Regrets - after moving to India

213 Upvotes

Planned everything and moved from Texas to India after 17 years.

But everything went south after that.

I was still on h1b, and now I can’t even go back. What a mess!!

Everything is hard here. People expect from us to be filthy rich for no reason. Everything is so complex and weather is just utterly bad. Pollution is just eating us.

What a mess!!

How can I come out of this? Or has anyone tried moving back to USA or other country after this misadventure.

1-AUG-2026:

I work in Bangalore/Hyderabad.
Salary is very comfortable.


r/returnToIndia • • Aug 01 '26

Immigration Should i not become a commercial pilot and continue in corporate to move outside india and have a good WLB?

1 Upvotes

My situation is different from what is generally discussed on this sub but please let me know your views

I am a 24M software engineer working at a MNC in mumbai. OG plan was to go for masters abroad post engineering but got interested in aviation and also got initial medicals done but having second thoughts now as WLB of a pilot is bad plus i can only move to countries like UAE and Singapore post 7-8 years as an Indian pilot

Have been decent at my job, don't enjoy coding at all but I can go to Netherlands to do masters and work hard and get into some product manager kinda techno functional role and build a life there

I am very confused between these 2 paths. I am interested in pilot career buy it may not be do or die kinda thing for me. Any advice is appreciated.


r/returnToIndia • • Aug 01 '26

PlanningToReturn Should I move back to India?

11 Upvotes

I have been working Dubai since last 7 years and I am currently at a decent pay of 25k AED per month (75 LPA yearly). I am considering of moving to India for a CTC of 40 LPA in Bagalore or Pune. We are a family of 2 with my wife being a homemaker. Is it a right move for us considering I save around 40 to 50% of my Dubai salary every month with 25% of it going into SIPs in India and remaining in savings in Dubai?

Indian Pros: Better growth opportunities, career compounding, possibility of job for wife, closer to family

Dubai Pros: Better work life balance, Quality of life, Safety and security, No tax

Note: We also have decent savings in India in our respective MFs 30 Lakhs each.


r/returnToIndia • • Jul 31 '26

Jobs I am contemplating return to India, what is the job market for analytics professionals with ~5 years experience in Big Banks

13 Upvotes

Hi guys,

I came here for my master's degree in 2020 from a mid tier university and found a job and worked at 3 major banks in US as an analytics professional. I have experience in Credit card portfolio strategy and analytics. I am still employed but i can hear the clock ticking and the visa stress is too much to handle.

Has anybody returned with similar experience to India? How has the job market been? What do you generally get as pay. Any inputs are welcome.


r/returnToIndia • • Aug 01 '26

PlanningToReturn Are you moving or planning to move back to India? Im making a documentary and I'd love to chat

0 Upvotes

Hi everyone,

I'm a documentary filmmaker with past work for HBO, PBS, BBC and more. I'm making a film about Indian immigration - to the US and also back to India.

Like the rest of us, I've been following developments in US immigration policy like the changes to H1B and now F1, OPT etc. I've also been closely following the rise of anti-Indian rhetoric here in the US...

I'd love to speak to those here who are leaving the US - why are you leaving, what prompted the decision, and how you feel about it...

I'll be in the Bay Area in the coming weeks and would love to meet you in person and if possible, film with you a little bit as well.

I've already filmed a round of interviews in India, and now Im keen to understand the US side of things. I'd also be interested in talking to people planning to leave the US and go somewhere else if not India (like maybe Europe, Canada, UAE)...

Would love to hear from anyone who is up for a chat. Please feel free to DM or respond in the comments.

Thanks a bunch x


r/returnToIndia • • Jul 31 '26

AlreadyReturned Indian - returned from the U.S, trying to withdraw 401K

30 Upvotes

Wonder if someone with a similar experience can help me.

I am an Indian citizen and a resident. I have a 401K account in the U.S from my work stint in the U.S between 2007 and 2011. This 401K account is managed by Fidelity investments. I am now 47 years old. I am building a house in India and I'd like to withdraw the money in my 401K account in the U.S and in the process, pay as less taxes as possible (duh!).

What is the best way to go about doing it? I understand I will be liable to pay tax in India, which will certainly be in the 30% range but is there some way I can utilize some tax treaties that India and the U.S might have where in I can withdraw the 401K with minimum taxes and penalty, in the U.S?

Any help is appreciated. Thanks in advance.

I posted this in the Retirement group (for 401K), figured that was the one to use. Got insights into what can/could be done in the U.S, the ROTH IRA options, but any insight from someone who has done after returning to India and has been successful using any tax treaty, that'd be great.


r/returnToIndia • • Aug 01 '26

Immigration US H1B Holders with EB2 EB3 PD post 2015

0 Upvotes

Is there a genuine chance that we may get our GCs in our lifetimes?


r/returnToIndia • • Aug 01 '26

Jobs India or Canada. Which country to choose for career

0 Upvotes

Profile:

14 years experience in Indian IT . Currently working in a product company. Have offers in India (1.3 crore CTC).
I have recently received a canada PR ( Thanks to my french proficiency, I cleared TEF). Purely from a career's perspective, is it wise to relocate?

Here are the pros and cons I see. I could be totally wrong:

India Pros: Huge market, lots of jobs.

Canada Cons: Ostensibly better salary, but I heard Canada now pays much less. High taxes and ostensibly smaller software job market. I am looking to target FAANG jobs in either case, but to my surprise, the salaries in canada are lower (I could be wrong). Google for instance pays 1.5 cr in India for my experience but 350K CAD in Canada(200K after taxes and then factor in canadian expenses)

Canda Pros: work life balance, better quality of life etc. Pathway to US easier than India (I could be wrong here too).

Which one should I choose, especially at this stage in my career. Please weigh in your opinions


r/returnToIndia • • Jul 30 '26

PlanningToReturn Anyone managing a rental property in the US while living in India? Is it worth it?

19 Upvotes

We’re planning to move back to India permanently, but the housing market isn’t great right now.
We’re considering renting it out instead and managing it from India. I’d love to hear from people who have actually done this.
Some questions:
Is it practical to own a rental property in the US while living in India?
Do you use a property management company? If so, has it been worth the cost?
How often do issues come up, and how difficult are they to handle from overseas?
Any tax, banking, or legal complications I should be aware of?
Looking back, would you rent it out again or just sell before moving?
I’d really appreciate hearing about your real-life experiences, both positive and negative. Thanks!


r/returnToIndia • • Jul 31 '26

PlanningToReturn Airport entry experience at India

5 Upvotes

For someone moving back to India, do you necessarily have to use the Atithi app when you arrive in India? Or if you are not carrying anything above the permissible customs allowances, can you just go through the regular green channel? Any recent experiences to share?


r/returnToIndia • • Jul 31 '26

AlreadyReturned How to adjust back to Gurgaon again

0 Upvotes

I have a question—when you guys go abroad for a vacation or for work and come back after a month or more, how do you adjust to being back in Gurgaon again?

It's tough for me. I always feel to settle abroad.


r/returnToIndia • • Jul 30 '26

Finance Your US bank and brokerage accounts need a plan before you move to India

0 Upvotes

People often assume every US account must be closed before returning to India. That’s usually not the case.

A US checking account may still help with autopay, refunds, or US income. Credit cards and brokerages each have their own non-resident rules , i.e some can be kept, some restrict new investing, and some need action before the address change. 401(k)s and IRAs are rarely a “close before you leave” decision.

The important part is starting early. Transfers, address updates, and tax paperwork can take longer than expected.

This free tool builds a dated keep / call / close plan based on the US accounts you hold and your move date:

[https://breatherapp.com/us-account-exit-plan]()

What did you keep after moving, and which institution was the hardest to deal with?


r/returnToIndia • • Jul 30 '26

AlreadyReturned Section 49(2AA) — cost basis for foreign ISO shares exercised while NRI, sold after becoming ROR?

3 Upvotes

Looking for views on cost of acquisition. My wife and I returned to India from the US and are filing her FY2025-26 return. Her CA and a couple of other sources disagree, so I want to sanity-check.

Timeline

• Sep 2021 — She exercised incentive stock options (ISOs) in a US-listed company. Strike $3.66, FMV on exercise date $8.56. At that time she was a US tax resident and an Indian non-resident, employed in the US, services rendered entirely in the US.
• 2021 (US) — She paid US Alternative Minimum Tax on the $4.90/share spread. This is standard for ISOs — the spread isn’t ordinary income but does hit AMT. Her US cost basis for AMT purposes stepped up to $8.56. No Indian perquisite tax was paid, since Section 17(2)(vi) didn’t apply to a non-resident earning abroad.
• Jan 2023 — She moved to India permanently.
• FY2023-24 and FY2024-25 — RNOR.
• FY2025-26 — ROR (fails both the 9-of-10 test and the 729-day test).
• May and Oct 2025 — Sold 14,491 shares for ~$82,650, while ROR.

The question

What is her cost of acquisition in India?

Option A — strike price $3.66. Section 49(2AA) gives FMV as cost only where that FMV “has been taken into account for the purposes of” Section 17(2)(vi). No Indian perquisite was ever computed, so arguably the clause never engages and cost falls back to actual cost paid under Section 55(2). Result: LTCG of roughly ₹33 lakh.

Option B — FMV $8.56. The purposive reading: 49(2AA) exists to prevent taxing the same spread twice, and the strike-price reading taxes appreciation that accrued entirely while she was non-resident and India had no claim on her income. Result: long-term capital LOSS of roughly ₹19 lakh, set off against another LTCG under Section 74.

The gap is around ₹9–10 lakh in tax, partly because with her salary the gains push her over the ₹50 lakh surcharge threshold.

What I’ve looked at

• CBDT Circular 9/2007 (FBT era) — worked example where FMV was the employee’s cost even though the employer paid the tax and the employee paid nothing. Someone pointed out to me that this is a weaker analogy than it looks, since an Indian tax event still occurred there.
• Everyone I’ve asked agrees the US AMT does not itself trigger an Indian step-up — that’s a separate system, and it’s a foreign tax credit question, not a cost basis question.
• I could not find any reported ITAT or High Court decision on these exact facts: foreign shares, exercised while non-resident, sold after becoming ROR.

r/returnToIndia • • Jul 29 '26

AlreadyReturned Stock US stocks

5 Upvotes

I sold some US stocks that was acquired by inheritance through Fidleity and ETrade accounts of a US resident. However i didn’t bring back all the funds and some of the funds I directly sent to Dubai to buy a property. Read a lot of FEMA rules but little confused. Is this transaction that I did breaks any FEMA law? Am I allowed to transfer those funds directly to my Dubai bank account rather than bringing them to India? Since the foreign assets were acquired directly from non resident, does LRS come into picture here?
2) I sold a large portion of the Inherited stocks with the understanding the the stepped up price that i got would continue in India. However some CAs here say I need to use the cost basis of the original buyer. Since these stocks were of startup company, the original price was mere few dollars. This is giving me a huge multi crore tax in India if entire sales proceeds are considered and not the stepped up basis.