Who is an NRI?
An individual shall be deemed to be a non-resident in following cases:
- When he stays in India for less than or upto 182 days during the preceding financial year. The period of stay may not be ‘continuous’ and the same shall be calculated by adding up the days of his stay in India during that financial year. Thus a student who goes for studies abroad and his stay in India during a financial year is less than 182 days, then he shall be treated as non-resident Indian for the next financial year. Similarly, tourists and all others who have gone out of India without the purpose of taking up employment or starting any business abroad, shall be treated as non-residents if, their stay in India during the preceding financial year was less than or upto 182 days.
- When he goes or stays outside India for any of the following purposes:
- For or on taking up employment outside India, or
- For carrying on outside India a business or vocation outside India, or
- For any other purpose, in such circumstances as would indicate his intention to stay outside India for an uncertain period.
In such cases, the person becomes a ‘non-resident’ irrespective of the period of his stay in India. It is pertinent to note here that while the period of his stay in India shall be reckoned for the preceding financial year, the event of going or staying abroad for any of the aforesaid purposes shall be reckoned for the current financial year.
Who is Resident but not ordinarily resident (RNOR)?
A Non Resident who has returned to India for good is covered under the provisions of section 6(6) of the Income-tax Act. He is given a special status of RESIDENT BUT NOT ORDINARILY RESIDENT (RNOR) if he satisfies one of the following conditions:
|The person is non-resident, as per the above provisions, for at least 9 out of 10 previous years prior to the previous year under consideration.||If yes, the person is RNOR|
|The person’s stay in India during the 7 previous years prior to the previous year under consideration should be 729 days or less.||If yes, the person is RNOR|
A person who is returning to India after 9 years of stay outside India (and who was non-resident for each of the 9 years under the Income Tax Act, 1961), shall remain RNOR for the period of two years only.
Who is a ‘PIO’?
‘Person of Indian Origin’ (PIO) means an individual (not being a citizen of Pakistan or Bangladesh or Sri Lanka or Afghanistan or China or Iran or Nepal or Bhutan) who
- at any time, held an Indian Passport or
- who or either of whose father or mother or whose grandfather or grandmother was a citizen of India by virtue of the Constitution of India or the Citizenship Act