How Residential Status is determined as per the Income-tax Act, 1961

Under Income Tax, the residential status of a person is one of the most important criteria in determining the tax implications. The residential status of a person can be categorized into:

1)      Resident and Ordinarily Resident (ROR), 

2)      Resident but Not Ordinarily Resident (RNOR) and 

3)      Non- Resident (NR)

 1)      Resident:   A resident taxpayer is an individual who satisfies any one of the following conditions:

·          Condition I (Resides in India for a minimum of 182 days in a year) – Not satisfied

·         Condition II (Resides in India for a minimum of 365 days in the immediately preceding four years and for a minimum of 60 days in the current financial year) – Satisfied

 2)      Resident and Ordinarily Resident (ROR) and Resident but Not Ordinarily Resident (RNOR)

·         There is a further classification under the resident status – Resident and Ordinarily Resident (ROR) and Resident but Not Ordinarily Resident (RNOR). 

In addition to the basic conditions, if both the below conditions are met, he will be an ROR:

·         He has resided in India for at least 2 out of 10 immediate previous years, and

·         He has resided in India for at least 730 days in 7 immediately previous years.

3)      Non-Resident :  An individual who does not satisfy the basic conditions of residence can be considered as a non-resident. 

Quiz link : quiz https://forms.gle/LdB7caoGQBJqkfNx7

Reference link: https://cleartax.in/s/income-tax-act-residential-status#h1