"Indian Tax Residency: Know Your Status & Liability"

The article explains how residential status under Indian law impacts tax liability, categorizing individuals as Residents, Non-Residents, or Residents but Not Ordinarily Residents (RNOR), with distinct tax obligations based on their global and India-sourced income.

Residential Status for Tax Purposes Under Indian Law

The residential status of an individual determines their tax liability under the Income Tax Act, 1961. Here's how you can determine residential status:

Category	Criteria	Description
Resident	Individual stays in India for 182 days or more during the financial year. OR stays in India for 60 days or more during the financial year AND 365 days or more in the preceding 4 financial years.	A resident is liable to pay tax on their global income, i.e., income earned both in India and outside India.
Non-Resident	Individual does not meet the criteria for being a resident as per the Income Tax Act.	A non-resident is liable to pay tax only on the income earned or accrued in India.
Resident but Not Ordinarily Resident (RNOR)	Individual is a resident but has been a non-resident in India for 9 out of the last 10 financial years. OR stays in India for 729 days or less during the last 7 financial years.	An RNOR is liable to pay tax on income earned or accrued in India and income derived from a business controlled or profession set up in India.

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