Residential Status – NRI or Resident? & NRI Taxation

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• Hello,
  My son has gone to USA for MS under F1 visa in August 2016. Is he an NRI? If yes then what should we do to his PAN card? Should we surrender it or keep holding it? Are we supposed to inform this to IT Dept? If yes how can we do that? Also what should we do to his savings account in India? Please advise

  • Dear Ketan Ji,
    If he stays in India in FY 2016-17 for minimum 182 days then he is Resident Indian, else NRI.
    There is nothing to do with updating PAN card status. He can file his ITR (if he a tax assessee) as an NRI.
    He has to inform his bankers about his NRI status. Update the status on all Deposits, Demat account, MFs, etc.,

    • Thank you for your response. Given the explanation above my son will have NRI status. My son is 23 now and he is not an assesse as his income never exceeded threshold limit in any FY so far.
      He does not have a demat account nor does he have any holding in MF.
      He has fixed deposit and interest income to the tune of 60K per annum. What will be Income tax implication, if any, on his interest income? Please advise

      Regards,
      Ketan Shah

      • Dear Ketan Ji,
        If his taxable income is Rs 60k only, then filing of ITR is not mandatory.
        Kindly read: Do I need to file my income tax return?

        • Thanks for informing.

          Regards,
          Ketan Shah

        • Dear Mr.S.R.,

          Hypothetically, suppose if my son has some income in USA by doing on campus job and if he pays Income tax in USA per prevalent tax laws in USA and also has Interest income (less than RS.2.0 Lacs) in India then will he be liable to any Income tax in India?
          Please advise,

          Regards,
          Ketan Shah

        • No, dear Ketan ji :) .
          But advisable to file ITR with NIL tax liability with NRI status (not mandatory though).

• Hi,

  My Name is Vipin. I am working out of India since November 2016. I know i will not be NRI for FY2016-2017. I will be out of India for more that 182 days in FY 2017 and 2018. So, do i need to pay any tax in India while i will file the ITR for FY2017 - 2018? Even if i am transferring some amount to my India account? Is this enough to get a NRI status?

  regards,
  Vipin

  • Dear Vipin,
    Kindly note that NRI status (Residential status) is dependent on number of days stayed outside India.
    You have to pay taxes on income derived in India if your Residential status becomes NRI.
    Kindly refer to the table provided in the article.

• Hello Sreekanth Jee,

  I am looking forward to your expert advise on below 2 points:

  PART ONE:
  01/04/2004 to 12/01/2016 worked ABROAD
  13/01/2016 until now in INDIA (worked for 3 months in Bangalore, TDS is deducted)

  Considering the above and with my little knowledge, I think for FY 2016-2017 I am RNOR, kindly advise.

  PART TWO:
  - Being in NR status I have opened PPF account in FY 2006-07 and have been making contribution to it, which I think is not correct. Kindly advise what should I do here
  - The PAN card I have has status as RESIDENT and is used for my resident saving account and TD and even for NRE & NRO account, which again I think is not correct. Kindly advise what should I do here
  -If I operate a saving account or TD (residential) with first name of my mother and mine as 2nd name, will that be an issue (please consider both scenarios - account opened before FY 2016-17 and in FY 2016-17
  - In FY 2016-17, I also have done trading in stock cash, margin buys & in MF using icicidirect portal, the point is in theory icicidirect considers me as resident. What should I do?
  - Lastly on my NRE account (which is in running status but with no foreign income remittances since 2016 onwards), till what period I can continue to operate it and its related NRE TD/s. I mean kindly consider that I am in India in FY 2016-17

  Looks little messed up, please can you shed some light as to what should I do...

  Would greatly appreciate your valued feedback.

  Regards.

  • Dear Alark,
    only little messed up??
    You have been an NRI for so long and surprised that you have not updated your Residential status on any of your investments??
    Suggest you to kindly consult a CA who is an expert in NRI taxation at the earliest.

• Hi Sreekanth,

  Need your support in identifying residential status for the financial year 2016-17. My husband was working in UAE from July 2013 till end of October 2016. During April 2016 to Oct 2016 i.e 212 days working in UAE as per employment record however out of 212 days he was in India for 60 days for attending business meeting and vacations. Net abroad stay during FY 16-17 is 152 days but employment is for 212 days. Pls advise on the NRI status for income tax clubbing.

  • Dear Deepika,
    Kindly note that if your husband stays in India for more than 182 days in this Fin Year (60 days + days of stay from Nov 16 to Mar 17), then his residential status would be RI (Resident Indian).

• Salary slip of income from japan received by person resident in india. (amount in JPY)
  Monthly paymrnts: 511334
  Deduction in japan:
  Social insurance
  Health 21250
  Pension 44570
  Labour 2045

  Taxable income after social insurance: 443469
  Tax 13630
  Deposited in bank 429839

  As she is resident income from japan will be taxable in india Tax will be calculated on 511334 or 429839
  Can she claim benefit of tax paid in japan -DTAA
  Also can she claim benefit of rent u/s 80gg

  Kindly help…………..

  • Dear Star..Suggest you to consult a Chartered Accountant.

• Dear Sreekanth

  I am a Nri from 2006. But in this FY , it is not possible for me to complete my 184 in aboard. Is my foreign income would be taxable in india.

  • Dear Shalendra,
    Kindly note that if you have stayed in India in a FY fore >= 182 days, residential status is RESIDENT Indian.
    However, if you have paid taxes on income earned from abroad sources with Foreign tax dept, you can make check if that country has DTAA (Double Taxation Avoidance Agreement) with India or not.
    To avoid paying tax on same income twice , one can use the provisions of the Double Taxation Avoidance Agreement (DTAA).

• Hello Mr. Shreekant, I have been out of the country on employment for more than 5 months ( around 160 days). I will be going out of the country next month for a holiday. Can that be included for calculating my 182 days?

  • Dear Dolly ..Yes has to be included for calculation of residential status purposes.

• i have stayed in USA on H1B Visa for 45 days in Tax Year 2015 and 145 days in TY 2016 and am married. My Spouse is in India she will be coming to US on 2017 on H1B VISA .So, what is the status for TY 2016 Should i file as a Resident or Non Resident

  • Dear Abhilash ..Kindly download the calculator and you may check for yourself.

• Dear Shreekanth,

  I returned back to India in july 2016 from USA. I was working there from 1-7-2012 hardly i have travelled for 15 days a year to india.Now have came back to india .So now i have to pay the taxes on my 3 months income from April to June of USA in india as i have already paid Taxes in USA for that. AND also is there any compensation for not staying in india from last 4 years for these foreign income of 3 months?Please help me out.

  Thank You,

  • Dear Abhishek,
    Unable to comprehend your query - "there any compensation for not staying in India from last 4 years for these foreign income of 3 months?" What type of compensation are your referring to??

• Hi Sreekanth,
  Thanks for helping out. I am having a query. I have come to Singapore as assignment ( but indian salary stopped and joined as employee in Singapore branch ) with singapore offer letter and salary. I have alreay spent 39 days in india and now i will be going back and resuming job in India on 1st feb. So total india days will be 39+59 = 98 Days.
  Rest all conditions like past 3 years , 7 years are not satisfied.

  So , will i be a NRI or Resident for tax purpose ? I am working in a big MNC and when they send for long term , they transfer the employement itself to that country and that is why getting singapore salary and employment. One of the tax consultant is saying i will be covered by 60 days rule and will become resident because i am coming back in same financial year. Very confusing , please help.

  • Dear Rocky,
    Kindly note that one has to meet both the conditions ie
    Stayed in India for 60 days or more in PY (AND)
    365 days in the 4 years preceding PY,
    To be considered as a Resident.
    Were you in India for at-least 365 days in last 4 years proceeding current FY.