# Residential Status of an Individual [Section 6]

Residential status decides what income is taxable in India. It is determined year by year — an individual may be resident in one year and non-resident in another.

## Two-Step Classification

```

Individual

│

┌───────┴────────┐

Resident Non-Resident

(satisfies any 1 (satisfies none

basic condition) of basic conditions)

```

If resident, further classified as ROR or RNOR.

## Basic Conditions (any one must be satisfied)

1. Stay in India for at least 182 days during the relevant Previous Year, OR

2. Stay in India for at least 60 days during the relevant PY AND 365 days or more during the 4 preceding PYs.

## Special Cases — Only Condition 1 (182 days) Applies

In the following cases, Condition 2 does not apply (60-day test ignored):

Crew member of an Indian Ship
Indian Citizen leaving India for employment outside India
Indian Citizen or Person of Indian Origin (PIO) coming to India on visit

Person of Indian Origin (PIO) = a person who, or whose parents or any of whose grandparents, was born in undivided India.

## Additional Conditions (for ROR vs RNOR)

A Resident is ROR only if he satisfies BOTH additional conditions:

1. Resident of India in at least 2 out of 10 preceding PYs, AND

2. Stay in India for at least 730 days during 7 preceding PYs.

If either is not satisfied → RNOR.

## Special Provisions

### Modified 120-Day Rule (Indian Citizen/PIO on Visit)

If an Indian Citizen or PIO comes to India on visit AND his Indian-source income (other than income earned & received outside India) exceeds ₹15 lakh in the PY, he becomes RNOR if:

He stays in India for at least 120 days in the relevant PY, AND
365 days or more in the 4 preceding PYs.

(Otherwise, the 182-day rule continues to apply.)

### Deemed Resident (Indian Citizen Not Liable to Tax Elsewhere)

An Indian Citizen whose Indian-source income exceeds ₹15 lakh in the PY is deemed RNOR if he is not liable to pay tax in any other country by reason of domicile/residence/similar criterion.

## Other Important Points

Residential status is determined separately for each PY.
'Stay in India' includes stay in Territorial Waters of India (up to 12 nautical miles from the baseline).
For counting days, both the date of arrival and date of departure are treated as days in India.
For a Crew member of Indian Ship, the period from the date entered in the Continuous Discharge Certificate at joining to the date at sign-off is treated as outside India.

Worked example

### Example 1

Example — Basic Condition Test

Mr. X stayed in India during PY 24-25 for 90 days. In the preceding 4 PYs, his total stay was 400 days. He is not in any of the special-case categories.

182-day test: 90 < 182 → Fails.
60-day + 365-day test: 90 ≥ 60 AND 400 ≥ 365 → Satisfies.

→ Resident.

If Mr. X had been an Indian Citizen who left India for employment, only the 182-day test would apply. 90 < 182 → Non-Resident.

### Example 2

Example — ROR vs RNOR

Mr. Y is a Resident in PY 24-25. In the 10 preceding PYs, he was Resident in 5 PYs. In the 7 preceding PYs, his total stay was 800 days.

Additional Condition 1: Resident in ≥ 2 of 10 preceding PYs → satisfied (5).
Additional Condition 2: Stay ≥ 730 days in 7 preceding PYs → satisfied (800).

→ ROR.

If his stay in 7 preceding PYs was 500 days, Condition 2 fails → RNOR.

### Example 3

Example — 120-Day Rule for PIO Visit

Mr. Z, a PIO living in Dubai, comes to India for 130 days in PY 24-25 and his Indian-source income is ₹20 lakh.

He stayed ≥ 120 days AND assume 365 days in preceding 4 PYs.
Indian income > ₹15 lakh.

→ He is RNOR (he is Resident, but special provision pegs him at RNOR irrespective of additional conditions).

If his Indian income was only ₹10 lakh, the 120-day rule wouldn't trigger; he'd need 182 days to be Resident → Non-Resident.

⚠️ Common exam mistakes

Applying the 60-day Basic Condition to Indian citizens leaving for employment or to PIOs/citizens visiting India — only the 182-day rule applies (subject to 120-day rule for high-income PIO/citizen visitors).
Excluding date of arrival or date of departure from the count — both are counted as days in India.
Forgetting that the 120-day rule only applies when Indian-source income > ₹15 lakh.
Treating crew-member sea voyage period as 'in India' — the CDC dates make it outside India.
Forgetting to check Additional Conditions separately — being Resident is not the end; ROR/RNOR matters for scope of income.
Confusing the 'deemed RNOR' rule (Indian citizen not liable to tax anywhere) with regular residence — it kicks in even if he never sets foot in India in the year.

Reference: Section 6(1), 6(6) — Income Tax Act, 1961

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Residential Status of Individual

Worked example

⚠️ Common exam mistakes