Tag Archives: FEMA

Proposed Rules Loosen Restrictions on Hardship Withdrawals

Based on proposed regulations released by the U.S. Department of Treasury on November 14, 2018 (the “Proposed Regulations”), participants in 401(k) and 403(b) plans may find it easier to get hardship withdrawals as early as plan years beginning after December 31, 2018. Hardship withdrawals are permitted on account of financial hardships if the distribution is made in response to an “immediate and heavy financial need” and the distribution is necessary to satisfy that need. The Proposed Regulations incorporate various prior statutory changes, including changes imposed by the 2017 Tax Act, the Bipartisan Budget Act of 2018, and the Pension Protection Act of 2006. These changes are summarized below:

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ILN Today Post

Foreign Exchange Management Act (“FEMA”)/Foreign Investment

Acceptance of deposits by Indian companies from a person resident outside India for nomination as Director

The Reserve Bank of India (“RBI”) has clarified that keeping deposits with an Indian company by persons resident outside India, in accordance with section 160 of the Companies Act, 2013, is a current account (payment) transaction and, as such, does not require any approval from the RBI. Refunds of such deposits, arising in the event of selection of the person as director or getting more than twenty-five (25) percent votes, will be accorded the same treatment. (Reference: A.P. (DIR Series) Circular No.59 of April 13, 2016). 

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