Residential Status – NRI or Resident? & NRI Taxation

View Comments

• Hi Sir

  This is a common question for lot of personnel working in Oil & Gas Offshore Industry. We are abroad for employment for more 183 days any fiscal year and we are eligible for rotational leave as per company policy, eg. 28 days work & 28 days off or 21 days work & 21 days off. We normally come back to India during our off days. However, we are confused about the criteria of “365 days or more in four years before that financial year under consideration.” If we consider above criteria then we are staying in India for more than 365 days or more in four years. Kindly advise whether we are eligible for NRI status?

  • Dear Thomas,
    If you are staying in India for more than 60 days in last Financial year AND 365 days or more during last 4 FYs (preceding previous FY), then residential status is Resident Indian only.
    Kindly note that both conditions have to be met.

• Hi Sreekanth,

  Fantastic article. However, I am a bit confused with the "Previous Year" calculation, as to which previous year to consider.
  Let me explain my situation and hopefully you will be able to understand it better:
  I went outside India on Feb, 2014 and then permanently returned to India on Aug 2016. My total stay in India during this period has been about 40 days (in trips of 15, 15 & 10).
  So, to determine my NRI status, should I consider 2016 as the previous year or 2015 as the previous year?
  Would the entire period of 1st April 2016 to 31st March 2017 be taxable for me or just Sep 2016 to 31st March 2017 would be taxable?

  Kindly share your thoughts about my tax liability an my NRI status.

  Thanks a lot.

  • Dear Sourin,
    Current FY is 2017-18, so previous financial year would be 2016-17.
    Yes in your case, PFY 1 would be 2016-17, PFY 2 is 2015-16 and so on...
    Taxable or not, it depends on your sources of income.
    If you have stayed in India for more than 182 days in FY 2016-17, your residential status is 'Resident Indian'.

• Hi Sree, I am Lakshminarayanan G.
  My query is,
  I worked in chennai(India) in the month April and May 2016 and paid income tax for those month income, Then i joined other company and working in foriegn; until march 31st of 2017 the days out side india are 167 days.
  So my doubt is here, 1. whether i need to pay in come tax for the income i earned after May 31st or not?
  2. Am i eligible to be an NRI in the financial year April 1'2016 to March 31'2017.
  3. In case i should pay income tax, how can i calculate my income over these period.

  Thank you in advance

  • Dear Lakshminarayanan,
    If you have stayed in India for more than 182 days in FY 2016-17, your residential status for FY 2016-17 /AY 2017-18 would be Resident Indian only.
    So, you need to include your foreign income along with salary received in India and file your tax return.
    In case, if you have to file taxes abroad, then you need to check if that country has Double Taxation Avoidance Agreement (DTAA) with India or not.
    Suggest you to consult a CA who offer service in NRI taxation matters.

    • Thank you so much for your prompt reply. So kind of you.

      • You are welcome!
        Kindly share the articles with your friends and keep visiting ReLakhs :)

        • Done sree. I am doing already. Thank you.

• Hi Sree,

  Thanks for a fantastic article! I just want to re-confirm my understanding to avoid any surprises later, since you obviously are quite a master on the subject.. :)

  I've been abroad on employment from December 2011 & will come back to India on May 31, 2017.

  Qn 1: So, for the FY 2019-20, I need to consider 7 years preceding .. which means FY 2012-13 to 2018-19, right?
  Qn 2: Once I return on June 01, 2017 I'll have only RNOR status for 2 years (since I'd spent holidays in between in India). However, if I spend additional 45 days (vacation even in Sri Lanka) till March 31, 2019, would I be eligible to be RNOR for 2019-20?
  Qn 3: If Yes to Answer 2, will I need to re-submit my RNOR claim status by March 31, 2019? Or, will it simply be my call to file tax returns as RNOR for 2019-20 also & submit proof, if IT Dept asks for it later?

  • Dear KB,
    Suggest you to use this calculator to just check which Status is applicable under different scenarios..Click here..
    For FY 2019-20, 7 years preceeding calculation for RNOR is from FY 2012-13 to 2018-19.

    Kindly note that to qualify as RNOR, either of these two conditions can be met;
    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

    • Thanks a tonne Sree!

• Dear Sri,

  Big fan of your articles. Need a favor.

  I've been an NRI since 1998. Moved back to India in Aug 2015. I've been in and out of India since though i have lived for more than 182 days in India. I still haven't changed my NRI account back to Ordinary account. Now that i'm finally content to be in India, i'm planning to change it to ordinary account. I'm just worried that i should have changed back a few months ago as i've been in India for more than 182 days. On the other hand i qualify as RNOR as I've been outside India for more than 15 year and it gives me RNOR status for 3 years. Also, remember, i haven't had more than 2,00,00 income overall since Aug 2015 till now so it's not that i have avoided paying tax or anything. Tell me if it's okay for me to change my status to ordinary resident or will i afce any problems. Thank you so much.

  • Dear Rohan,
    Based on the info provided by you, I do not foresee any issue if you change your Residential status to Ordinary Resident.
    Suggest you to consult a CA in case, you are transferring any Assets or investments from Foreign accounts to Indian Saving accounts.

• Hello,
  I too have a query, which is as follows:-
  I am a NRI and on my visit to India (which is was less than 182 days) i thought of getting my new passport. my earlier passport had the address of USA residency but now i got the permanent address of India on my Passport, but i am still an NRI, but the problem is the foreign banks are not accepting.
  My question is can you please confirm if there is an Indian Address on my Indian Passport then does that necessarily mean that the passport holder is an Indian Tax Residence.

  Thank you

  • Dear Swati,
    No, not necessarily. I can have Indian residential address on my passport and can still be an NRI.

• Hi ,

  I wassent to Qatar on Business Visa from August-7th-2016 by my company. Subsequently I was transferred to Qatar from 1-Nov-2016 . Till October I was getting salary in my Indian Account.

  My organisation has deducted TDS @30% on my Qatar salary also starting from November .

  Please suggest whether I will be able to get a refund as my stay outside India is more than 182 days.This was my first overseas visit.

  Regards,

  Pavan

  • Dear Pavan,
    Let me know if your company has a subsidiary in Qatar?
    Kindly note that any income accruing outside India from a business controlled in India is 'not taxable in India'.
    So, I believe that TDS on your salary from Nov 2016, can be claimed as Refund.

    • Our company has a Subsidary here.
      However the Business Unit which I was working in has deputed me here and Started paying in Qatari Riyal from November.Salary is proocessed by same unit but currency is different.

      Regards,

      Pavan Reddy

• does staying in srilanka counted as nri days ? and staying alone will be enough or do we need to produce employment cert

  • Dear honey,
    Your Visa stamping is a proof..
    Yes, can be considered as an NRI.

• Hi,

  In 2016-2017 FY, I traveled abroad more than 185 days on business trip to different countries. As part of Business trip I just got TA/DA from company and company giving Salary in Indian bank account with income TAX Cut. Please let us know how I will be identified as NRI/RI or related TAX implication.

  • Dear ASHISH,
    If you have stayed in India for greater than or equal to 182 days then resident indian, else yoru residential status would be NRI.

• Hi,

  i am Seamen. In this Financial Year i went for studies 30 days aboard for my exams. Then i completed 138 days on board. Excluding in and out days from india.
  now i going to join again but i will complete 182 days on board only if i exclude the joining date. previous 5 yrs i am maintain NRI status . Now ths FY Am i NRI ?

  • Dear sumathi,
    Kindly note that both the Day of Arrival into India and the Day of Departure from India are counted as the days of stay in India (i.e. 2 days stay in India).
    So, if your total number of days of residing in India are greater than or equal to 182 days, then your residential status would be RI (Resident Indian), else NRI.