Does SEBI stop an NRI from investing in a PMS?

No. We searched the full consolidated text of the portfolio management regulations for "non-resident", "NRI", "nationality" and "citizen". There are no hits.

There is no residency test in the rules. A portfolio manager may take you as a client on exactly the same terms as a resident.

  • Minimum: ₹50 lakh, per portfolio manager
  • Accredited investors are exempt from the minimum
  • Your shares sit in your own demat account, in your name

So why do some houses still say no?

Because of your country, not India's.

If you live in the United States, taking your money can drag the house into US securities law. Registration there is expensive and, for a foreign fund, often impossible. So most decline rather than deal with it.

That is a commercial decision by that house. It is not a legal bar on you, and another house may say yes.

What do you actually need to open one?

The paperwork is more ordinary than people expect.

  • A PAN
  • An NRE or NRO bank account, depending on the route you choose
  • A demat account linked to that bank account
  • KYC through the usual Indian process

Repatriable or non-repatriable? Decide before you invest

This is the choice people get wrong, and it is expensive to change later.

On a repatriable basis, your money and gains can go back out. Listed-share purchases run through a designated bank branch, and an individual non-resident stays under 10% of any one company.

On a non-repatriable basis, the investment is treated as domestic money. Simpler, but the proceeds stay in India unless you use your annual remittance allowance.

From an NRO account you can send out up to US $1 million per financial year, with the documentation your bank asks for.

How is it taxed if you are an NRI?

A PMS holds shares in your own name. So every sale your manager makes is your sale, in your Indian return, that year. Tax is deducted at source, and you claim any excess back by filing.

If a tax treaty applies to you, it may reduce the rate. Claiming it needs a residency certificate from your own country plus an Indian information form.

Where you live changes this a lot. It is worth reading the guide for your own country before you commit.