Residence Status

Save Share

This query is : Resolved

Quick Summary

This discussion clarifies the tax residence status for a US citizen who lived in India for several years before returning to the US. The core question is whether their stay in India qualifies them for Non-Resident (NR) status or if they are considered Resident but Not Ordinarily Resident (RNOR) for Indian tax purposes. The conversation highlights the specific day-count conditions and financial year requirements for determining ROR (Resident and Ordinarily Resident) vs. RNOR status, especially concerning stays exceeding 729 days in preceding years.

Network

Network (Querist)
Follow

23 July 2022 Hello CA Club community

What will be tax residence status of a USA citizen who has been living in India for a few years and moved back to USA in FY 2021/22 and lived in USA for 10 months in USA between Apr 1 2021 to March 31 2022 ?

.Moved to India in FY 2013/14 and lived in India until Jun3 2022, Was a non resident FROM fy 2001/02 to FY 2012/13 ( lived in USA all those years ) and non resident also in FY 2021/22 ( lived 10 months in USA, moved back to USA ). So 2 years in the last 10 financial years have been as non resident. Will this suffice to quality for a RNOR status in India for AY 20 ?

Do they have to show their foreign income, foreign assets and foreign financial accounts in India for ay 2022/23 an RNOR ?

Thank You

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
Follow

23 July 2022 No. The condition of RNOR are not met....

One who is an Indian Resident with any of the two conditions mentioned above as met, AND,
Has NRI Status for 9 out of 10 years before the year concerned, OR,
Has been in India for a maximum of 729 days in the 7 years before the year concerned

Network

Network (Querist)
Follow

23 July 2022 Dhirajlal sir - I'm a bit confused. "Has been in India for a maximum of 729 days in the 7 years before the year concerned'.

A.
Year concerned = AY 2022/23
7 YEARS before AY 2022/23 will b from AY 2015/16 to AY 2021/22. This condition is met since the stay is much more than 729 days, and the below resident condition is is also met:

B
Stay in India for at least 365 days* during the 4 years preceding that year AND at least 60 days* in that year, since the move to USA happened in June 2022.

Both A and B conditions are met, so that why would the person in question not qualify as RNOR ?

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
Follow

23 July 2022 A. The condition is maximum 729 days.... NOT MORE then 729 days...
B. That is not the condition for RNOR but for Resident... Resident can be ROR or RNOR.
As he is not RNOR, he is ROR...

Network

Network (Querist)
Follow

25 July 2022 Dhirajlal sir,

Using the residential calculator available on income tax website, the above status is qualifying as non resdient.

https://www.incometaxindia.gov.in/Pages/tools/residential-status-calculator.aspx

FY 2021/22:

Number of days in Inida: less than 182
Income in India: less than 15 lakhs
If PIO then even if the income is more than 15 lakhs, the status is showing as non resident.

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
Follow

25 July 2022 Correct. For less than 182 days is first condition but there is another condition to be checked, i.e. Stay in India for the immediately 4 preceding years is 365 days or more and 60 days or more in the relevant financial year... As per that he doesn't qualify.

You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now