Definition of a Non-Resident Indian (NRI)

An Indian Citizen who stays abroad for employment/carrying on business or vocation outside India or stays abroad under circumstances indicating an intention for an uncertain duration of stay abroad is a non-resident. (Persons posted in U.N. Organisations and Officials deputed abroad by Central/State Governments and Public Sector undertakings on temporary assignments are also treated as non-residents). Non –Resident foreign citizens of Indian Origin are treated on par with non-resident Indian Citizens (NRIs) for the purpose of certain facilities.

Main categories of NRIs

The following are the main three categories of NRIs:-

(i) Indian citizens who stay abroad for employment or for carrying on a business or Vocation or any other purpose in circumstances indicating an indefinite period of stay abroad.

(ii) Indian citizens working abroad on assignment with foreign government agencies like United Nations Organisation (UNO), including its affiliates, International Monetary Fund (IMF), World Bank etc.

(iii) Officials of Central and State Government and Public Sector undertaking deputed abroad on temporary assignments or posted to their offices, including Indian diplomat missions, abroad.

Provisions regarding Resident and Non-Resident under Income Tax Act and Foreign Exchange Regulation Act

The residential status of a person is decided under two different Acts, one under Income Tax Act, 1961, ( I.T. Act) and another under Foreign Exchange Regulation Act, 1973 (FERA). The concept of Non-Resident under FERA is different as compared to that under Income Tax Act. Under Income Tax Act, the residential status of a person is determined on the basis of number of days he stays in India whereas under FERA, it is the intention of a person to be in India or outside India would be an important factor determining his residential status.

Provisions under the I.T. Act

The residential status for the Income Tax Act is determined in section 6 as under:

1. An individual will be treated as a resident in India in any previous year if he fulfills any of the following two conditions:

(a) he/she is in India in that year for period or periods amounting in all to 182 days or more, or

(b) Having within the four years preceding that year been in India for a period or periods amounting in all to 365 days or more, and has been in India for 60 days or more in that year.

2. Under Explanation to section 6 (1) of the Income-tax Act, the residential status of an individual who is rendering service outside India and who visits India during leave or vacations in any previous year or an individual who is outside India and who comes on a visit to India in any previous year will be determined as under :

(a) An Indian citizen who leaves India in any previous year for the purpose of employment outside India or as a crew member of an Indian ship would be treated as a resident in India if he stays in India in that year for 182 days or more [instead of 60 days as stated in 1 (b) above ]. Conversely, if he stays in India for less than 182 days, he will be treated as non-resident for that year and his foreign income would not attract tax liability.

Further, w.e.f. 1st April, 1999, a crew member will be treated as non-resident in India if he is on board such ship outside the territorial water of India for 182 days or more during any year.

(b) An Indian citizen or a person of Indian origin who resides outside India and who comes on a visit to India in any previous year will be treated as resident in India if he stays in India in that year for 182 days or more [instead of 60 days as stated in 1 (b) above.]

Conversely, he will be treated as non-resident if he stays in India in that year for less than 182 days.

(3) An individual (whether Indian citizens or not) who is outside India and who comes on a visit to India in any previous year will be treated as “non-resident” in India if he stays in India in that previous year less than 182 days subject to the condition that during the preceding four previous years his stay in India does not amount to 365 days or more.

An Individual who fulfills any of the conditions mentioned in section 6(1) is treated as resident in India. But in order to become an “ordinarily resident”, he must satisfy the following two conditions as laid down under section 6(6) (a) of the Income-tax Act, 1961:

(i) He should have been resident in India in nine out of the ten previous years preceding the previous year in which he is resident within the meaning of section 6(1); and

(ii) He should have been in India for a period or periods amounting in all to 730 days or more during the seven years preceding that previous year.

If he does not fulfill any of the above conditions, he will be treated as “not ordinarily resident”.

(4) An individual who does not satisfy both the conditions as mentioned above as laid down in section 6 (1) will be treated as “non-resident” in that previous year.

(5) A Hindu undivided family, firm or other association of persons will be treated as “non –resident” in India in any previous year if the control and management of its affairs is situated wholly outside India during that year.

(6) A company will be treated as “non-resident” in India in any previous year if it is not an Indian company and also the control and management of its affairs is not situated wholly in India in that year.

The Provisions under Foreign Exchange Regulation Act (FERA) :

Section 2 (p) and 2 (q) of FERA define resident and non-resident as under:

2(p) “person resident in India” means-

(i) a citizens of India ,who has, at any time after the 25th day of March, 1947, been staying in India, but does not include a citizens of India who has gone out of, or stays outside, India in either case-

(a) for or on taking up employment outside India, or

(b) for carrying on outside India a business or vocation outside India, or

(c) for any other purpose, in such circumstances as would indicate his intention to stay outside India for an uncertain period.

(ii) a citizen of India, who having ceased by virtue of paragraph (a) or paragraph (b) or paragraph (c) of sub-clause (i) to be resident in India, return to, or stays in, India, in either case-

a) for or on taking up employment in India, or

b) for carrying on in India a business or vocation in India, or

c) for any other purposes, in such circumstances as would indicate his intention to stay in India for an uncertain period.

(iii) a person, not being a citizen of India, who has come to, or stays in India, in either case-

a) for or on taking up employment in India, or

b) for carrying on in India a business or vocation in India, or

c) for any other purpose, in such circumstances as would indicate his intention to stay in India for an uncertain period.

(iv) a Citizen of India, who not having stayed in India at any time after the 25th day of March, 1947, comes to India for any of the purpose referred to in paragraphs (a), (b), and (c) of the sub-clause (iii) or for the purpose and in the circumstances referred to in paragraph (d) of that sub-clause or having come to India stays in India for any such purpose and in such circumstances.

Explanation.- A person, who has, by reason only of paragraph (a) or paragraph (b) or paragraph (d) of sub-clause (iii) been resident in India, shall, during any period in which he is outside India be deemed to be not resident in India.

Clarification :

(A) It has been clarified in the Exchange Control Manual (ECM) that Indian Citizens who proceed abroad for business visits, medical treatment, study which do not indicate their intention to stay outside in India for an indefinite period will be considered as “person resident in India” during their temporary absence from India.

(B) An office or a branch situated in India, of any business, whether carried on by a body corporate or otherwise, whether Indian or Foreign, is treated for all purpose of FERA as “person resident of India”.

2 (q) “person resident outside India” means a person who is not resident in India . Thus the term “non-resident” is synonymous with the term, “person resident outside India”.


About the Author

- Vakilno1 is a group of Law Enthusiasts and Legal Experts in India with a passion to provide the latest info and articles on Indian Legal System







Displaying 22 Comments
Have Your Say
  1. Priti Mehta says:

    Is a person holding an Indian passport, residing in Nepal for the last 40 years, considered a non – resident Indian or not ? Why? And what is documentation ( something from Government of India ) to prove or disprove the same ? This is rather urgent . Would appreciate an immediate reply

  2. kalpesh says:

    STAY IN INDIA FROM 1-4 TO 31-3

    92/93 140
    93/94 14
    94/95 35
    95/96 143
    96/97 99
    97/98 111
    98/99 92
    99/2000 58
    00/01 123
    01/02 155
    02/03 76
    03/04 89
    04/05 0
    05/06 186
    06/07 108
    07/08 82
    08/09 88
    09/10 94
    10/11 100
    11/12 93
    12/13 232

    DEAR SIR DT / 16/11/2013

  3. is the arrival and departure days included in the 183 days require to fulfill the nri time

  4. ketan dodhia says:


    My question is that my sister is married to critesh citizen ion 27/1/1998 at india and then after one month she left with indian passport and still today she is haveing indian citizenship. nowshe have an inheretanant agri. land on her name then on 3/10/1998 she buy a agri. land sending via banking channel foreign currency in GB pound and inward remittence certi is accquired from bamk then she sold the land in 2007 to indian resident person .

    now the 1st trnascation whille brought the new agri. land from forein currency in oct 1998 is valid. or it need permission from RBI or is she violate FERA Act? the time between feb 1996 and oct 1998 she may came to india for 1-2 months and again in 1998. but she is not having intenstion to stay for uk. maybe they shift to india in future after marriage . is that give her NRI statu or the oct 1998 agri. land purhcse is violation of rule of FERA. need any permission. if she cant get then what is the conciquencies becasue she already sold the land in 2007 and the whole money is still in india she can repatieate any penny from here.?

    pls guide me on this issue i will be very thnkfull to you

  5. William says:

    During 2013-14 financial year I was in India for more than 183 days and all the previous 25 plus years I was outside the country as an NRI. Please let me know whether I am bound to file income Tax returns for the year 2013-14 ? And how long I can keep my NRI status if I am continuosly staying in India more than 183 days in a financial Year giving a brake outside India for four to five months in a year.

  6. INDRAJIT says:

    I have a query, sir that my daughter had gone to the USA three yrs ago to pursue higher studies availing an education loan from a bank. After finishing her studies, she has been employed in an NGO in the US for the last one year. She has been paying her education loan EMI’s since getting the employment by remittance directly to the bank where she also holds her saving account. She has no income in India, except some bank interest.

    Please advise if she’s entitled to avail the benefit/refund under section 80E of income Tax Act. If so, which Return form she needs to file and whether it could be filed on line.

  7. vimal says:

    I would like to know how the 182 days are calculated… Is the arrival and departure dates included?
    Do they calculate hours?

  8. Hi would you mind sharing which blog platform you’re working with?
    I’m going to start my own blog soon but I’m having a difficult time deciding between BlogEngine/Wordpress/B2evolution and Drupal.
    The reason I ask is because your design seems different then most blogs and I’m looking for something unique.
    P.S Apologies for getting off-topic but I had to

  9. Laxman says:

    for the FY 2013-14. i stayed on ship -outside india for less than 183 days and in india for more than 182 days. But the reason for my stayin in india for such long time is the further education and have not earned anything in india during my stay, so am i eligible for filling the tax amount?

  10. Ajay says:

    I am a resident of India, since last 6 months I got a job in Dubai ( UAE ) as sales manager, but I stay mostly out of UAE, and more in India more than 182 days in India, so I am not a NRI, not the salary and commission which I get in UAE in paid to me in foreign uae currency, so do i require to show this in my income in India and if I do not bring this funds to India and spend for my expense in UAE then is it required to show in my books in India or not.

  11. Chait 77 says:

    Hi ! I have a query. I have recently taken up an internal job out of country in Singapore effective 1st of September and will be working for the company in Singapore but will split my time between India and Singapore since i have some responsiblities in India to complete. Until end of December, i will continue to get 50% of my salary in India as well as 50% salary in singapore. My India role will cease to exist effective 1st of January. Would i need to pay tax for my income in Singapore in both India and Singapore for this financial year? Please clarify.

  12. VK Malhotra says:

    If a person goes abroad for studies to do MBA for 2 yrs and then takes up a job in that country what shall be his status under the IT Act say he left India on 31 Jul 2013, completes his MBA 30 May2015 and then after a gap of 2 months say 31 Jul/01 Aug 2015 he takes up the job. How these periods shall be termed ?

  13. Raj says:

    I am an NRI but also qualify as a Indian resident because my stays in India exceeds the minimum number of days to be considered resident for past 7 years. I frequently go in and out of the country every year. Can I enjoy both benefits by holding both NRO (foreign currency) and local account (Indian transactions)? If not then what are my liabilities of holding a resident account and is there any other way I can bring my foreign currency to India every once in a while.

  14. ramesh chandra dabral says:

    I am from India and wish to join any Indian man who lived in abroad for some business offer etc

  15. Suresh Inti says:

    I’m working in Gulf for the last 6 yrs’s staying more than 185 day there. This year due to medical ground i may miss 183 day’s abroad. All my salaries are from Gulf only. In this case what will be my taxable income.
    1) Income from my salary abroad. or
    2) Money transferred to NRE account or
    3) NRE acccount intrest for the financial year

    Pl clarify

  16. […] given its consent to the recommendation of a committee that favored voting for Non-Resident Indians (NRI) through electronic […]

  17. Ravi says:


    This FY, I have been out of India since August End, but had come to India for a months vacation in December. I have completed 183 days in India (but that includes my vacations). I got Work Permit of my current country only last month (Jan) and have been receiving a salary here from Jan.I was receiving Indian salary till Dec, eventhough i was not in India from Sep-Dec’14. Will I be considered as a “Resident’ for Tax purposes and my global salary would be taxed ?

    Also, I would return to India in Dec’15. Will I be considered as Resident for Tax and then also my global salary would be taxed ?

    Pls clarify.

  18. Ashok Kumar says:

    I want to know whether a person who avails a TR after being outside India for 30 years plus can still visit foreign country whose visa is on his passport……visa may be for the country he resided 30 years plus or any other country say USA or Canada or Europe.

    Shall very much appreciate your response
    Ashok Kumar

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