Residential Status – NRI or Resident? & NRI Taxation

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• Hi. I am having an issue. I was in UAE since 6 Apr 2014. I will be arriving in India this year on 31-Oct-18. But this FY from 1 Apr till 31-Oct I spent total 188 days in India. So technically I will be considered Resident of India. However, can I go abroad in this FY for 6 days or so and qualify for the NRI status?

• Hello Sir,

  I was been there in india for 183 days,

  No doubt , the income during I was in india is taxble.
  But from Oct-17 to till date I am on resident permit in UAE.during this period my income in UAE is taxble ? Do I need to put as a taxable while filling the income tax return?

  • Dear Kedar,
    Suggest you to kindly consult a CA who is an expert in NRI taxation matters..

• after maintaining a proper NRI status for 20 years - If you stay in India for 210 days then what happens to your NRI status

  • Dear Jacky,
    You become Resident Indian or RNOR (Resident but not Ordinary Resident).

• I am a shippie and not completing 182 days this financial year.Can i file rnor

  • Dear Remya,
    A person is an RNOR if he meets either of these two conditions: - He/she has been non-resident in India, that is, an NRI, in nine out of the ten previous years preceding that year, or - He/she has, during the seven previous years preceding that year, been in India for a period of 729 days or less.

    Suggest you to kindly go through this article...

• Hi... I'm a seafarer and haven't completed 182 days outside India in the financial year... I earned more than 2.5 lakhs in the financial year, but transferred less than 2.5 lakhs (say 2.2 lakhs) to Indian banks; rest of income was taken in cash and spent outside India... Do I need to pay tax in India?

  • Dear JayDee,
    Suggest you to file your ITR.

• Please advise if i go out on international holidays, will these days counted as NRI DAYS ??

  • Yes dear SKS..

    • Thank you sir, one last query.

      i m a shippy so i will take contract of 5 months on foreign going ship in this financial year and planning to do one month international holiday which would complete my 182 days of total NRI DAYS for financial year 2018-19.

      hope above scenario qualify me for NRI DAYS for financial year 2018-19.

      thank you for your kind advise.

      • Dear SKS,
        Ok. Kindly use the calculator or consult a CA and plan your travel.

• Hi,

  I have left to Singapore for employment on 9 th March 2018.

  Till today it has not been 182 days but I will stay in Singapore long term.

  I want to close my PPF account, (the 15 yr tenure of the PPF account is not complete), when can I close my PPF.

  • Dear Kamran,
    Kindly go through this article @ Latest NSC & PPF rules for Non-Resident Indians (NRIs) | New Amendments to PPF Act & NSC

• Hi Sreekanth

  Let me begin by mentioning that I really enjoy reading your website. You have provided a whole array of great useful information for novices like me. I really thank you for that. Now to come to my query.
  I have been an NRI for the past 2 years (i.e FY 2015-16 & 2016-17) I have been out of the country the whole time. So that would make my status as NRI. The only income that I have in India is interest out of my FDs which comes to around Rs. 60,000 /- per year. I checked my 26AS and it matches and the bank has accordingly deducted the TDS on that amount. Now my question is Do I have to file my returns for this 60,000 interest income. What will happen if I dont file the returns.

  I Thank you in advance for your response.

  • Dear Prakash,
    Glad to know that you like my articles and you find them useful!
    As you do not have income which is in taxable limit, there is no need to file tax return.
    But, if you file ITR, you can claim the TDS as refund.
    Also, the IT dept may issue compliance notice asking for reason of non-filing of ITR notice, for which you may have to respond that your income is below taxable limit.
    So, to avoid this , advisable to file ITR and claim your refund.
    Are these normal FDs? (interest income on NRE deposits are tax-free).

    • Dear Sreekanth, Thank you very much for your prompt reply. Yes they are Normal FDs, which I had booked while I was a resident 3 years ago.
      You mentioned that I might receive the Non Filers notice. Is that an issue or submitting compliance will take care of it.

      • Dear Prakash,
        As mentioned in my previous comment, its not a big issue if you have income which is below taxable limit.
        But why would you like to miss your refund amount, so advisable to file ITR (as an NRI).

• Hi,
  I have a small clarification to know about my taxation for the year 2016-17. Let me explain my situation.

  I have joined in company outside India since October 2011 - Till October 2016. and Since October 22nd 2016 i am staying in India. Let me give you exact details of my vacation no of days spent in India.

  Financial Year No of Days spent in India

  2012-2013 60
  2013-2014 50
  2014-2015 42
  2015-2016 Till March 56

  So in April 2016 i left back to job outside India on 19th April 2016 and then in between i came to India for emergency in September for 21 days and left the company in October 3rd and returned on 21st October 2016. Since Then i am staying in India but not having any income in India since then till now.

  Please let me know whether i am taxable for my any income i earned outside India for 2016-2017 and transferred the salary money to India every month since April 2016 till November 2016. Because many are confusing with their view that some says i am not taxable and some says i am taxable. please clarify based on my query as stated above please.

  Thanks
  Vivek

  • Dear Vivek ..Kindly use the calculator given in the article and check your Residential status for FY 2016-17.
    Else, you may let me know the total no of days that are in India in FY 2016-17??

    • in last four financial year till 2016 March my total no of days in india was 240 days. In FY 2016-2017 from April 2016 till March 2017 is 220 days.

      • Dear Vivek,
        If you have stayed in India for more than 182 days (in your case it is 220 days) during FY 2016-17, then your residential status is Resident Indian.
        So, you need to file income tax return as RI and taxes (if any) will be applicable.
        Read : Do I need to file ITR?
        In case, you have paid taxes on your foreign income earned during FY 2016-17, and if that country has a DTAA (Double Taxation Avoidance Agreement) with India, you can claim your taxes accordingly. Suggest you to take help of a CA.

• I want like to know if there are any regulations in India, that restrict me from transferring funds between two different NRE account holders?

  The underlying transaction is that I wish to acquire a commercial property in India which has been booked by another Non Resident Indian. The said property is still under construction and hence has not been registered as yet by the first buyer. He has made partial payment towards the said property and now wishes to withdraw from the deal.

  Hence, to the extent that the first buyer has made payments from his NRE bank account or through the mortgage route to the builder, I need to reimburse him.

  The remaining payments on the property I can pay (through my NRE bank account) directly to the builder.

  I have been advised by the builder that since the property has not been registered, it cannot be treated as a "Resale" and they have no objection to replace the booking in their records to my name.

  Please let me know if there are any tax or other implications that I can be subject to in the above transaction and what steps do I need to take to execute the "transfer of the booking name"

  • Dear Raj,
    Kindly make sure they prepare new Sale agreement in your name before you transfer the amount to the first prospective buyer. Ask for the cancellation confirmation and then re-book it in your name.
    As far as I know, I do not see any issue with money-transfer between NRE accounts.
    (Somehow, I sense that it is advisable to book the property as a fresh booking rather than going through this route, to keep it clean and simple).

    • Sale Agreement is not an issue. As the Developer is quite trustworthy.

      In fact, the property is now ready for Registration as well.

      I have come to be aware that there could be a TDS involved as per section 195 of the Income Tax Act 1961. This is what I need further clarification on.

      Section 195 states that any payment made to a non-resident by a person tax has to be deducted on the same at prescribed rates. Section 195(2) of the Act specifies that in case the person is of the opinion that the payment is not taxable in India then an application has to be made to the concerned income tax officer, who shall pass an appropriate order in relation to the tax to be deducted.

      What is not clear to me is if the said process applies for payment by an Indian Resident to a Non-Resident or from Non-Resident to Non-Resident as well

      • Dear Raj,
        In case of sale of property by NRI, it is mandatory for buyer (Resident Indian) to deduct 20.66% TDS on the sale price of the property if capital gain is long term capital gain.
        Also, here sale of property is not happening between the two NRIs, am I right. So, section 195 may NOT at all applicable in your case.
        You may also take advice from a CA.

        • Please note that both the parties to the transaction are NON-RESIDENTS having Non Resident External (NRE) accounts with banks.

          Technically there is no sale or purchase happening but rather a reimbursement of the amount as the original "prospective buyer" could not continue with his purchase and is withdrawing mid-way.

          Does this so called section 195 apply since both of us are NRI's?