Residential Status

1. Basic Concepts of Income tax

2. 'WHY SHOULD I PAY TAX?

3. What Government Do from our TAX?
 Health care and Education
 Cooking gas
 National Defense, Infrastructure Developments etc.
 Various welfare schemes
 Administrative cost
 Judicial Salaries, perks of Judges, Magistrates and judicial
staff

4. DIRECT
TAXES
INDIRECT
TAXES
Income tax
GST
Customs Duty

5. Normal
Assessee
Representative
Assessee
Deemed
Assessee
Pay taxes for the income
earned by him for a
particular financial year
Assessee
IMPORTANT TERMS
Assessee-
in-Default
Pay taxes for income or
losses incurred not only by
him, but also by a third party
Pay taxes for some other
person by the legal
authorities
Failed to fulfill his legal
duty of paying tax

6. WHO ARE LIABLE FOR TAX?
1. Individuals
2. Hindu Undivided families
3. Companies
4. Firms (partnerships)
5. Association of persons or bodies of individuals
6. Local authority (municipal bodies)
7. Artificial juridical person

7. Determine the status of following persons
1. Reliance Industries Limited.
2. Madras University.
3. Calcutta Municipal Corporation.
4. A partnership firm with A, B and C partners.
5. A Brahmin Parivar consisting of Mr. A, his
brother B, Mrs. A and B.

8. Determine the status of following persons
1. Reserve Bank of India.
2. Life Insurance Corporation of India.
3. Mr. Narendra Modi, Prime Minister of
India.
4. A Village Panchyat.
5. Markfed, Housefed.

9. PREVIOUS YEAR (Section 2(34))
The financial year
immediately preceding the
assessment year
Previous Year
2020-2021
Assessment Year
2021-2022

10. ASSESSMENT YEAR (Section 2(9))
The period of twelve months
commencing on the 1st day of April
every year and ending on 31st March
every year.

11. Previous Year
1.4.2020 to 31.3.2021
Assessment Year
1.4.2021 to 31.3.2022

12. Determine the Previous year and Assessment year
Financial Year
1.4.2000 to 31.3.2001
1.4.2006 to 31.3.2007
1.4.2010 to 31.3.2011
1.4.2017 to 31.3.2018

14. HEADS OF INCOME
Gross Total Income = Aggregate of Five
Heads of Income.
Total Income = GTI – Deductions u/s 80C
to 80U.
Total Income is also called as Taxable
Income.

15. RESIDENTIAL STATUS
• World income is taxable
in India
RESIDENT
• Only income arising or
accruing in India is
taxable in India
NON
RESIDENT
(NRI)
• Income accruing or arising
outside India may also be
taxable in India
RESIDENT BUT
NOT
ORDINARLY
RESIDENT

16. RESIDENT u/s
6(1)
In India for a
period of 182 days
or more in the FY
In India for 60 days or
more during FY &
in India for 365 days or
more during 4 previous
years immediately
preceding the RFY.
(a) (b)
(or)
RESIDENTIAL STATUS OF AN INDIVIDUAL

17. ORDINARY
RESIDENT
u/s 6(6)
Resident in India in
atleast 2 years out of 10
previous year
immediately preceding
the previous year.
In India for a period of 730
days or more during 7
years immediately
preceding the relevant
previous year.
(a) (b)
RESIDENTIAL STATUS OF AN INDIVIDUAL

18. NON
RESIDENT
u/s 2(30)
Individual who does
not satisfy at least
one of the basic
conditions
u/s 6 (1).
RESIDENTIAL STATUS OF AN INDIVIDUAL

19. Example:
Rickey Pointing, an Australian cricketer has been
coming to India for 100 days every year since 2006-
07:
(a) Determine his residential status for the assessment
year 2020-2021.
(b) Will your answer be different if he has been
coming to India for 110 days instead of 100 days
every year.

20. • RPY - 182 days
Sec 6(1) a
• RPY - 60 Days
• Preceding 4 years – 365 days
Sec 6(1) b
• Resident in India 2 PY out of
10 preceding PY
Sec 6(6) a
• Stay in India 730 days out of
7 preceding PY
Sec 6(6) b
RESULT = R But Not OR
R
O
R
and
or
(a)

21. • RPY - 182 days
Sec 6(1) a
• RPY – 60 Days
• Preceding 4 years – 365
days
Sec 6(1) b
• Resident in India 2 PY out of
10 preceding PY
Sec 6(6) a
• Stay in India 730 days out of
7 preceding PY
Sec 6(6) b
Result = Resident
R
OR and
or
(b)

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