Similarly, do you know that if you have been away from India for a while, and come back to India, your residential status changes?

What is the status of kids born to Indian parents in foreign countries? What is their resident status for India?

Let’s understand all the residential statuses to get an answer to these questions.

Resident Indian

In simple terms: A person residing in India is called a Resident Indian.

Here’s the definition:

A person is a Resident Indian for a given financial year if he / she fulfills the following conditions for that financial year:

(Do not understand terms like Financial Year and Assessment Year? Please read “Income Tax (IT) Jargon – Financial Year (FY), Assessment Year (AY) and Previous Year (PY)”)

1.
- He / she is in India in that year for 182 days or more (This irrespective of whether the stay is a continuous period of 182 days, or in multiple parts) OR

- In the 4 years preceding that year, he / she has been in India for a total of 365 days or more AND has been in India for 60 days or more in that year. (Again, this irrespective of whether the stay is a continuous or in multiple parts)

2. He / she is in India for more than 182 days in at least nine out of the ten previous years

3. He / she is in India for a total of 730 days or more during the seven previous years

Resident but Not Ordinary Resident (RNOR)

In simple terms: A person residing in India, but who has been an NRI in some previous years is called a Resident but Not Ordinary Resident.

Here’s the definition:

A person is a Resident but Not Ordinary Resident (RNOR) for a given financial year if he / she fulfills the following conditions for that financial year:

(Do not understand terms like Financial Year and Assessment Year? Please read “Income Tax (IT) Jargon – Financial Year (FY), Assessment Year (AY) and Previous Year (PY)”)

1.
- He / she is in India in that year for 182 days or more (This irrespective of whether the stay is a continuous period of 182 days, or in multiple parts) OR

- In the 4 years preceding that year, he / she has been in India for a total of 365 days or more AND has been in India for 60 days or more in that year. (Again, this irrespective of whether the stay is a continuous or in multiple parts)

2.
- He / she is in India for more than 182 days in les than nine out of the ten previous years OR

- He / she is in India for less than a total of 730 days or more during the seven previous years

Non Resident Indian (NRI)

In simple terms: A Non Resident Indian (NRI) is an Indian Citizen, who stays outside India for an uncertain duration of stay.

Here’s the definition:

A person is a Non Resident Indian (NRI) for a given financial year if he / she fulfills any of the following conditions for that financial year:

(Do not understand terms like Financial Year and Assessment Year? Please read “Income Tax (IT) Jargon – Financial Year (FY), Assessment Year (AY) and Previous Year (PY)”)

1. He / she is in India in that year for 182 days or more (This irrespective of whether the stay is a continuous period of 182 days, or in multiple parts)

2. In the 4 years preceding that year, he / she has been in India for a total of 365 days or more AND has been in India for 60 days or more in that year. (Again, this irrespective of whether the stay is a continuous or in multiple parts)

Note: A Hindu Undivided Family (HUF) is considered a Non Resident in a year if its management is done from outside India during that year.

Person of Indian Origin (PIO)

(Note: The Income Tax (IT) Act doesn’t define a PIO)

In simple terms: A person is called a “Person of Indian Origin” (or PIO) if he / she was ever a citizen of India, or if he / she has roots in India.

Here’s the definition:

For opening a bank account and investing in Indian stock markets

A person is called a “Person of Indian Origin” (or PIO) if:

1.
He / she is a citizen of any country other than Pakistan / Bangladesh

2.
- He / she held an Indian passport at any time OR
- Either of his / her parents or any of his / her grand parents were a citizen of India OR
- He / she is a spouse of an Indian citizen or a spouse of a person whose parents / grand parents were a citizen of India

For property transactions

A person is called a “Person of Indian Origin” (or PIO) if:

1.
He / she is a citizen of any country other than Pakistan / Bangladesh / Afghanistan / Bhutan / Sri Lanka / Nepal / China / Iran

2.
- He / she held an Indian passport at any time OR
- Either of his / her parents or any of his / her grand parents were a citizen of India

(Are you an NRI / PIO and want to know about Permanent Account Number (PAN)? Please read “Permanent Account Number (PAN) for an NRI and a PIO”)

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