is this way legal?

C

cryptex

New Member
#1
#1
Hi all, i read that resident Indians can't trade forex using margin.

I have a bank account in US. If a friend of mine is willing to make deposit in USD in my name can i use it to fund my account with an overseas broker and be safe from legal issues?

I read that INR can't be converted to fund directly the accounts. But the above way legal?
:confused:
 
P

pkdoo7

New Member
#2
#2
well you can trade this way , but you would need to go abroad to consume your money because if some how you will with draw your money from trading account to your local Indian bank account then , ANY Time you might be convicted for violation of rules of FEMA 1999 , specially you must have to verify your transaction legality , if comes from forex trading then according to rule you will be liable to give three times more money of your total transaction as a penalty . because RBI is not allowing remittance as well as forex trading too . then how you think a safe passage between the trade and rule . if you earn money through forex trade then you would need to clear at the time of tax returns filling.
 
C

comm4300

Well-Known Member
#4
#4
pkdoo7 said:
well you can trade this way , but you would need to go abroad to consume your money because if some how you will with draw your money from trading account to your local Indian bank account then , ANY Time you might be convicted for violation of rules of FEMA 1999 , specially you must have to verify your transaction legality , if comes from forex trading then according to rule you will be liable to give three times more money of your total transaction as a penalty . because RBI is not allowing remittance as well as forex trading too . then how you think a safe passage between the trade and rule . if you earn money through forex trade then you would need to clear at the time of tax returns filling.
Click to expand...
Some brokers, like Hotforex issue VISA card.

So, let's say a trader makes profit and requests for VISA card. This card is linked to the Tradng account of the trader [not any bank account];

In this case, the trader can withdraw from any ATM or swipe it across any merchant. Yes, the charges would be high, but this is unique way to withdraw money.

Your thoughts on this type of withdrawal via card.

thanks
 
P

PipMaster6

New Member
#6
#6
I don't understand the problem. If only a bank like barclays or citibank has your money, and not the actual forex broker, then why is it illegal? It's just transactions between you and a large bank...
 
C

comm4300

Well-Known Member
#7
#7
cryptex said:
Hi all, i read that resident Indians can't trade forex using margin.

I have a bank account in US. If a friend of mine is willing to make deposit in USD in my name can i use it to fund my account with an overseas broker and be safe from legal issues?

I read that INR can't be converted to fund directly the accounts. But the above way legal?
:confused:
Click to expand...
depends on the status of your citizenship here in India. If you are obligated to file taxes here : then there could be problem. However, if not, then it is good to go.

Better idea would be to have the forex account opened in your friend's name. Assuming your friend is not an Indian resident.
You get to operate it using your friend's id and password.

Any profits withdrawn would be credited to your friend's account. Then, let your friend transfer the money to your Indian bank account.

No question of filing taxes, when your friend is "lending" money to you each month!
 
Saiyyed Rafik

Saiyyed Rafik

Member
#9
#9
I`m agree with comm4300, You can use the VISA card, I have few more tips for you as a Indian, If you are interested let me know so I can write over here.(its seems that you never came back to check reply after your first post)
 
Last edited:
Y

yogasutra

New Member
#10
#10
I am an Indian citizen residing in India. I have a friend in whose name I have opened a Forex Account in Dubai. I trade, I make money. Give him 10% and he sends me 90%. Can I not show this as income from other sources while filing my IT returns in India? If the taxman comes calling, I can say that I provide a service using my expertise in forex and receive compensation for the same.

Please advise.
 
You must log in or register to reply here.
Thread starter Similar threads Forum Replies Date
P What are the legal formalities to sell equity research reports online? Trading Career and Jobs 7
CougarTrader !!! Beware Illegal AmiBroker Users !!! AmiBroker 61
S I am individual indian resident, Can i trade nymex crude mini from interactive broker LLC it is legal or illegal as per fema act and LRS Energy 3
gopija Is trading on nifty options illegal ? Derivatives 4
gopija Is trading on nifty options illegal ? Derivatives 0

Similar threads