Can NRIs Invest in Indian PMS and How?

NRIs can invest in a SEBI-registered PMS using NRE or NRO funds, subject to FEMA compliance and a ₹50 lakh minimum. The portfolio is held in a dedicated demat and bank account in the investor’s own name never pooled. Returns are taxed under Indian equity rules, and repatriation depends on whether the source account is NRE or NRO.

According to the investment team at Chanakya Capital, a SEBI-registered portfolio manager, “NRIs often assume PMS is only for resident Indians it isn’t, but the account setup, tax treatment, and repatriation rules are different enough that getting them wrong costs real money before a single trade is placed.”

The documentation and account structure for NRI PMS differs from resident onboarding in a few specific ways. Four things to have in place:

• NRE or NRO account: NRE is the cleaner route principal and gains are fully repatriable, and you’re not tracking annual remittance limits the way NRO investors have to.
• PIS permission: You need RBI’s Portfolio Investment Scheme permission through a designated bank before the PMS manager can trade on your behalf most major banks issue it, but it takes time, so apply early.
• KYC and FATCA: Passport, overseas address proof, and a FATCA declaration are standard US tax residents add a layer that some smaller PMS providers aren’t set up to handle.
• Demat account: An NRI demat linked to your PIS-enabled bank account is mandatory securities sit in your name, not pooled, which is the whole point of PMS over a mutual fund.

So the paperwork is heavier than resident onboarding, but it’s a one-time setup. Once the accounts are linked and KYC is cleared, the PMS manager operates with the same discretion they’d have for any other client. See who qualifies to invest with Chanakya Capital

Tax treatment and repatriation are the two questions NRIs ask most and they’re linked to which account the investment came from. Four points that matter:

• STCG and LTCG: Post-2024 Budget, NRI rates match resident rates 20% short-term, 12.5% long-term above ₹1.25 lakh but TDS is deducted at source automatically on NRI accounts before proceeds are credited.
• TDS deduction: You don’t file and pay per transaction, but your liquidity is net of TDS excess deductions come back only after filing an Indian income tax return.
• NRE repatriation: Fully repatriable with no annual cap principal and gains move to your foreign account without paperwork beyond the standard bank process.
• NRO repatriation: Capped at USD 1 million per financial year with a CA certificate required workable at the ₹50 lakh minimum, but a real constraint on larger allocations.

But for NRIs with large offshore allocations, the NRO repatriation cap and domestic TDS deduction are friction points a GIFT City AIF structure avoids entirely a nuance worth understanding before committing capital, as Chanakya Capital’s investment approach is built for serious long-term investors.

Chanakya Capital Services Pvt. Ltd. is a SEBI-registered portfolio manager (INP000006040) with over 35 years of combined Indian equity experience, serving HNIs, NRIs, and family offices through both onshore PMS and a Category III AIF at GIFT City IFSC. The team manages concentrated, first-principles equity portfolios typically 12 to 18 stocks where the top positions carry genuine conviction, not index-hugging. 

For NRIs specifically, Chanakya offers both routes onshore PMS via NRE/NRO for those who want direct Indian equity ownership, and the GIFT City AIF for those who prefer USD denomination, cleaner repatriation, and a more favourable tax structure. The decision between the two comes down to your account setup, allocation size, and how long you want to stay invested.

References

• SEBI Portfolio Managers Regulations 2020 (Last amended September 2025):
• RBI Foreign Exchange Management (Transfer or Issue of Security by a Person Resident outside India) Regulations Schedule 3: Portfolio Investment Scheme for NRIs: