An individual’s taxability in India is determined by his residential status under the income tax act in India for any given fiscal year. The phrase “residential status” was coined by India’s income tax rules and should not be confused with an individual’s citizenship in India. There is more information about it in my PPT.The foreign income i.e. income accruing or arising outside India in any financial year is liable to income-tax in that year even if it is not received or brought into India.Income tax is a interesting subject that you can learn easily.Follow me for more information.

1. Residential status of an
assessee
Hindustan college of arts and science
Department of commerce
CREATED BY:
Midhula shre M L

2. Discussion points
Key topics covered in this presentation
• Residential status of an
assessee- Meaning
• Types of Residential Status
• Residential status of an
individual assessee
• Incidence of tax
• An individual assessee-Sum
• Incidence of tax-Sum

3. Residential status of
an assessee-Meaning
The term 'residential status'
has been defined in the
Income Tax Act, 1961 solely
for the purpose of
establishing whether a
taxpayer resided in India in a
given financial year or not.
Tax is levied on total income
of assessee. Under the
provisions of Income-tax
Act, 1961 the total income of
each person is based upon
his residential status.

4. For Individual and Hindu Undivided
Family:
1.Resident and Ordinarily
Resident.
2.Resident but Not Ordinarily
Resident.
3.Non-Resident.
For Firm,Company,BOI and
Others:
1.Resident.
2.Non-Resident.

5. Residential status of an assessee
He has resided in India for at least 2
out of 10 immediate previous years.
AND
He has resided in India for at least 730
days in 7 immediately previous years.
Resides in India for a minimum of
182 days in a year,
OR
Resided in India for atleast 365 days
in the immediately preceding four
years and for a minimum of 60 days
in the current financial year.

6. Not Ordinarily
Resident
Non-Resident
Make it clear in next
slides.
Resident and
Ordinarily Resident

7. Resident and Ordinarily Resident :
A resident is one who satisfies any one of the basic conditions and both
of the additional conditions.
That is, the individual has stayed in India for 182 days or more. In
consecutively preceding four years, the individual has resided in India
for 365 days or more.
If he or she spends 730 days or more in India in the seven years
preceding the current year.
If he/she has resided in India for at least two of the ten prior fiscal years
before the current year.
Resident and Ordinarily Resident :
A resident is one who satisfies any one of the basic conditions and both
of the additional conditions.
That is, the individual has stayed in India for 182 days or more. In
consecutively preceding four years, the individual has resided in India
for 365 days or more.
If he or she spends 730 days or more in India in the seven years
preceding the current year.
If he/she has resided in India for at least two of the ten prior fiscal years
before the current year.

8. Non-Resident Sec.2(30):
Not Ordinarily Resident:
A not-ordinary resident is one who satisfies any one of the basic conditions and
does not satisfies either one or two of the additional conditions. Example:He has
only visited his parents for a week, twice a year during this time. That means, he has
resided in India for 449 days in the past six years and the same applies for the
current financial year too. In this case, first condition is satisfied but not the second.
Therefore, Mr. D is Resident Not Ordinarily Resident.
A non- resident is one who does not satisfy any of the basic conditions. In this
caseit is immaterial to see whether he complies with the basic conditions. An
Indian citizen who leaves India in any year for the purpose of employment
outside India or as a crew member of an Indian ship
Not Ordinarily Resident:
Non-Resident Sec.2(30):

9. Incidence of tax

11. Foreign Income
The foreign income i.e. income accruing or arising outside
India in any financial year is liable to income-tax in that year
even if it is not received or brought into India.
Indian Income
From Assessment Year 2021-22, an Indian Citizen earning
total income in excess of Rs. 15 lakhs (other than from
foreign sources) shall be deemed to be resident in India if
he is not liable to pay tax in any country.
Incidence of tax
Indian Income on Resident ,Not Ordinarily Resident and
Non-resident is taxable in all cases while in Foreign Income
it is taxable on Resident and Ordinarily Resident(if control
in India and professional set up in India) but not in Non-
Resident.
Foreign Income
The foreign income i.e. income accruing or arising outside
India in any financial year is liable to income-tax in that year
even if it is not received or brought into India.
Indian Income
From Assessment Year 2021-22, an Indian Citizen earning
total income in excess of Rs. 15 lakhs (other than from
foreign sources) shall be deemed to be resident in India if
he is not liable to pay tax in any country.
Incidence of tax
Indian Income on Resident ,Not Ordinarily Resident and
Non-resident is taxable in all cases while in Foreign Income
it is taxable on Resident and Ordinarily Resident(if control
in India and professional set up in India) but not in Non-
Resident.
Incidence of tax is
nothing but the
determination of tax
liability of a person on
whom the final tax is
levied
Foreign Income
The foreign income i.e. income accruing or arising outside
India in any financial year is liable to income-tax in that year
even if it is not received or brought into India.
Indian Income
From Assessment Year 2021-22, an Indian Citizen earning
total income in excess of Rs. 15 lakhs (other than from
foreign sources) shall be deemed to be resident in India if
he is not liable to pay tax in any country.
Incidence of tax
Indian Income on Resident ,Not Ordinarily Resident and
Non-resident is taxable in all cases while in Foreign Income
it is taxable on Resident and Ordinarily Resident(if control
in India and professional set up in India) but not in Non-
Resident.

12. An individual assessee sum:
Solution : Resident and
Ordinarily Resident.
Mr.Amal satisfies the first basic
condition.As he was in India for
182 days. Apr-30,May-31,Jun-
30,Jul-31,Aug-31,Sep-29.
Since it was the first time he left
India,he would satisfied both
the additional conditions.
Therefore he is a resident of
India.
Mr.Amal,an Indian citizen left
India for the first time on
29.09.2022.He did not return
until 31.03.23.Determine his
residential status for the
P.Y.2022-23
Question:

13. Question: Mr.Chowthry,an Indian citizen employed in U.S.A.,came to India on 30.12.2022 for a
visit and went back on 06.05.2023.Determine his residential status.
Solution:
Note 1: Number of the days of stay in India during the Previous Year 2021-22( He didn't came to
India till November. So Dec-2,Jan-31,Feb-28,Mar-31=92 days).
Note 2: When an Indian citizen settles abroad,he has to stay at least for 182 days during the
previous year in order to be treated as resident.Since Chowthry stayed for 92 days during the
P.Y.2022-23,he is a non-resident.
Note 3 : Additional conditions need not be considered as he is a Non-Resident.
Question: Mr.Chowthry,an Indian citizen employed in U.S.A.,came to India on 30.12.2022 for a
visit and went back on 06.05.2023.Determine his residential status.
Solution:
Note 1: Number of the days of stay in India during the Previous Year 2021-22( He didn't came to
India till November. So Dec-2,Jan-31,Feb-28,Mar-31=92 days).
Note 2: When an Indian citizen settles abroad,he has to stay at least for 182 days during the
previous year in order to be treated as resident.Since Chowthry stayed for 92 days during the
P.Y.2022-23,he is a non-resident.
Note 3 : Additional conditions need not be considered as he is a Non-Resident.

14. Mr. Riyas earned the following income during
the previous year 2022-23. Ascertain his
taxable income assuming that he is (a)
Resident (b) Not ordinarily and (c) Non-
Resident.
Incidence of tax-Sum
i.Income from property in England. 60000
ii.Past untaxed income. 75000
iii.Dividend from Indian company. 50000
iv.Dividend from foreign company. 40000
Mr. Riyas earned the following income during
the previous year 2022-23. Ascertain his
taxable income assuming that he is (a)
Resident (b) Not ordinarily and (c) Non-
Resident.

15. Particulars R NOR NR
Income from property in England 60000 - -
Past untaxed income - - -
Dividend from Indian company 50000 50000 50000
Dividend from foreign company 40000 40000 40000
Taxable Income 150000 90000 90000
Solution