—Guide
Tax Residency in India: 182 Days, 120 Days, Deemed Residence and RNOR
How an individual's residential status is decided in India — the day-count tests, the 120-day rule, deemed residence, RNOR — and why it matters for tax.
Your residential status decides what India taxes. Residents who are ordinarily resident pay tax on worldwide income; non-residents only on Indian income. The tests are mostly about days in India, with special rules for citizens and people of Indian origin. This guide explains them.
Note: this describes the rules under the Income-tax Act, 1961, which are carried into the Income-tax Act, 2025 for later years.
The Basic Tests
An individual is resident in India for a financial year if they are in India for:
- 182 days or more in the year, or
- 60 days or more in the year and 365 days or more in the preceding four years.
Exceptions to the 60-day Test
- Indian citizens leaving India for employment abroad, or as crew of an Indian ship, use 182 days instead of 60.
- Indian citizens and persons of Indian origin visiting India use 182 days instead of 60 — unless their Indian income exceeds ₹15 lakh, in which case the 60 days becomes 120 days.
Deemed Residence
An Indian citizen whose income from Indian sources exceeds ₹15 lakh, and who isn't liable to tax in any other country because of domicile or residence, is deemed resident in India. They're generally treated as 'resident but not ordinarily resident'.
Ordinarily Resident or Not
A resident is 'not ordinarily resident' (RNOR) if they were non-resident in nine of the preceding ten years, or were in India for 729 days or less in the preceding seven years — or in the specific cases under the 120-day and deemed residence rules. RNORs are generally taxed only on Indian income and income from a business controlled or profession set up in India.
Why It Matters
- Ordinarily residents are taxed on worldwide income and must report foreign assets.
- RNOR status gives returning NRIs a transition period.
- Non-residents are taxed only on Indian income, often at withholding rates.
Dual Residence
If you're resident in India and another country under their respective laws, the tie-breaker rules in the tax treaty decide which country treats you as resident for treaty purposes.
Getting Help
Think Filing determines residential status for individuals moving to or from India, and plans around the transition.