Why residential status matters more than citizenship
In India, tax is not based on your passport. It is based on your residential status for the year. A resident is taxed on worldwide income; a non-resident (NRI) is taxed only on income that arises in India, such as rent, capital gains, or interest from an Indian bank. The same person can be a resident one year and an NRI the next, because status is tested afresh every financial year — 1 April to 31 March.
The two-part day-count test
Under Section 6 of the Income-tax Act, 2025, you are treated as a resident if you meet either of these conditions:
- You are in India for 182 days or more during the tax year; or
- You are in India for 60 days or more in the year and 365 days or more across the four preceding years.
If you meet neither, you are a non-resident for that year. The rules are unchanged in spirit from the old 1961 Act, so most NRIs will recognise them.
Two important tweaks change Test 2. If you left India during the year for a job abroad, or you are crew on a ship, only the 182-day test applies to you. And if your Indian-source income crosses ₹15 lakh, the '60 days' figure in Test 2 is read as '120 days'.
Two exceptions every NRI should know
The second test has carve-outs designed to protect genuine NRIs.
Leaving India for work. If you leave India during the year for employment abroad, or as a crew member of an Indian ship, only the 182-day test applies. The 60-day condition is switched off, so a shorter stay won't accidentally make you a resident.
High Indian income. If your income from Indian sources (excluding foreign income) crosses ₹15 lakh in the year, the '60 days' figure in the second test is read as 120 days. This tightens the rule for high earners who spend meaningful time in India.
The day you arrive and the day you leave both usually count as days in India. Keep your passport stamps and boarding passes — they are your evidence if the tax office ever asks.
RNOR: the useful in-between status
There is a third category: Resident but Not Ordinarily Resident (RNOR). It typically applies to returning NRIs and, broadly, to those who were non-resident in most of the previous ten years. An RNOR is taxed almost like an NRI — foreign income generally stays out of the Indian net — which makes the first two or three years after moving back to India valuable for planning.
Can you be a tax resident of two countries?
Yes, in theory you can satisfy the residency rules of two countries in the same year. This is where India's Double Taxation Avoidance Agreements (DTAAs) step in, using tie-breaker rules — permanent home, centre of vital interests, habitual abode — to assign you to one country. A tax residency certificate from your country of residence is often the key document to claim relief.
Quick check: are you a resident this year?
A simplified read of the day-count tests — adjust the inputs to your situation.
Enter your days in India to see an instant read.
Indicative only — a simplified reading of the Section 6 day-count tests. Use the full residency calculator →
- Status is decided by days in India, not citizenship, and is re-tested every year.
- 182 days makes you a resident; the 60+365 test can too, unless an exception applies.
- NRIs working abroad get the 182-day-only rule; high Indian earners face a 120-day threshold.
- RNOR can shield foreign income for returning NRIs — plan around it.
Frequently asked questions
Does the 2025 Act change how my status is calculated?
The core day-count tests carry over from the earlier law. Key changes take effect from 1 April 2026, so count your days for each year against the rules in force that year.
I visited India for 100 days this year. Am I a resident?
Not on the first test. Check the second: were you also in India 365+ days over the last four years? If not — and no exception applies — you remain an NRI.
Do NRE/FCNR interest earnings affect my status?
No. Your status depends on days in India, not on where you bank. But your status does affect whether that interest is taxable.
This article is for general information only and reflects rules current as of 2026. It is not legal, tax, or financial advice — rules change and individual circumstances differ, so please consult a qualified professional before acting.