The Big Apple no longer wants to be the dreamland of opportunity for foreign workers. Donald Trump’s second term is turning out to be a dark chapter for skilled labour that has been crucial in building the US economy. Anti-immigrant policies, rising layoffs in the technology sector, and soaring living costs are forcing Indians to reconsider their future. It’s a ghar wapsi many never planned for, but are now being pushed into.

“After taxes, my take-home pay is around $42K, which makes things even tougher,” says a Redditor who is struggling financially. Her partner hasn’t been able to find a job either, and beyond that, “I’m feeling lost, and the stress is starting to take a toll on me.” She is weighing whether she should return to India.

It’s a ticking time bomb for many H-1B visa holders, who are increasingly apprehensive about their future in the United States. In a recent survey, many Indians living in America confirmed that one in six Indian H-1B visa holders, or someone they know, has been served a deportation notice. Nearly half said they would return to India if forced to leave.

A techie, who spent 21 years in the United States and even obtained citizenship, now wants to move back to India. With a net worth of $1.5 million and a house in Hyderabad, his reason is simple, “a monotonous life in the US and ageing parents.”

Here’s a comprehensive guide for those willing to return to India and want to understand how to restart their life.

When are you liable for taxes in India

The first decision is timing, not transfers. A non-resident Indian’s tax identity changes the moment one’s days in India cross the thresholds under the Income-tax Act. The income tax department guidelines state that if you live in India for more than 182 days in a financial year, you’re a resident for tax purposes, even if you are not earning in India. There’s also a second test of 60 days in the year, plus a 365 days across the previous four years.

What is Resident but Not Ordinarily Resident status?

If you plan the homecoming smartly, you may qualify for a bridge category called RNOR (Resident but Not Ordinarily Resident) in your first year or two back. Income tax department’s FAQs summarise the test neatly – you’re RNOR if you were non-resident in nine of the ten prior years, or spent 729 days or less in India over the last seven. Apart from this your Indian-sourced income must be above Rs 15 lakh (excluding foreign sources).

Your tax obligations as an RNOR stay like NRI status – you only pay taxes on money you earn or receive in India. With RNOR status, your salary in your NRE account stays non-taxable, even though you keep the account in India. RNORs are taxed in India on Indian-source income and income from a business controlled in India, not on foreign-source income received abroad. That means you can re-sequence foreign liquidations, stagger conversions, and avoid rushing into rupee assets purely for tax fear. 

Once you become a resident, India taxes all your worldwide income, except for what’s covered under Double Taxation Avoidance Agreements.

If you do qualify as RNOR, you buy time: your global income generally stays outside India’s tax net while Indian income remains taxable.

What happens to your NRE Account?

Under RBI rules, when you return for good, your NRE account can’t be active. The central bank is unambiguous: “NRE accounts should be designated as resident accounts or the funds should be transferred to the Resident Foreign Currency (RFC) accounts, immediately upon the return of the account holder.”

The RFC account is key for you to start afresh. It is a foreign-currency waiting room for returning NRIs: you can park dollars or pounds in India without forced conversion on day one, and move to rupees when you actually need them. You must update KYC details in all Indian bank accounts with a new residential status.

Indian banks and RBI guidance explain the purpose clearly: it’s a resident’s account in foreign currency for money you earned abroad, a bridge that preserves optionality while you settle in. RBI’s own FAQ pegs that at $250,000 per financial year per resident. Families can plan multi-person limits over multiple years; single-person shortcuts don’t exist

If you keep some wealth abroad for now (say, an overseas home you will sell later), remember that once you’re resident, outward remittances fall under the Liberalised Remittance Scheme caps for individuals.

Taxation and Compliances for NRIs

When an NRI returns to India and changes residential status, taxation and compliance steps become critical. The first formality is to update the PAN card records to reflect the new “resident” status, since this determines how the Income Tax Department categorises your filings.

From the following assessment year, you are required to file your Income Tax Return as a resident Indian. That also means you must disclose all foreign assets and overseas income in your return, in line with Indian tax law.

If you still have earnings or assets abroad, it’s important to check whether the Double Taxation Avoidance Agreement (DTAA) applies. This will ensure the same income is not taxed twice. To claim DTAA benefits you are required to provide a Tax Residency Certificate (TRC), which serves as proof of your tax residency status. Together, these steps ensure your finances are legally compliant, your filings are accurate, and you avoid unpleasant surprises during scrutiny.

PAN and Aadhar Documents

When you return to India, updating identification documents is just as important as moving your money. Every family member should have their paperwork in order. This means your passports, Aadhaar cards, and PAN cards must all be current and consistent.

The Income Tax Department now requires PAN to be linked with Aadhaar for filings to be accepted, so this link is non-negotiable if you want your tax compliance to run smoothly. Alongside that, make sure your address and contact information are correctly updated in both Aadhaar and PAN records.

These details are often used for OTPs, notices, and verification, so even a small mismatch can cause avoidable delays. Treat this as the foundation of your financial homecoming — once the IDs are in sync, everything else, from opening a bank account to filing taxes, will be easier. 

Real Estate investment tips

India makes it easy for returning Indians to buy residential or commercial property, but draws a hard line for agricultural land, farmhouses and plantations are off-limits for purchase by NRIs/OCIs.

RBI’s immovable-property FAQ spells this out – if you already own property and later sell, the repatriation rules are equally specific: you can repatriate up to the original foreign-exchange cost of not more than two residential properties, and the rest—if any—moves under the separate USD 1 million route via your NRO account. The point isn’t to memorise acronyms; it’s to know the guardrails before you sign.

Your return to India will be smooth if you consider these money moves and tax compliances.