How Many Days Can You Spend in India as an NRI Before It Hits Your Taxes?

 

Recently, a client asked: "How many days can I stay in India without losing my NRI tax status?" It’s a question that many NRIs face, and the answer can have a big impact on your taxes.

If you’re an NRI, how long you stay in India matters. Spend too much time here, and you might end up paying taxes on your worldwide income.

How Does India Decide Your Tax Residency?

India classifies taxpayers into three categories:

 

1. Resident
2. Resident but Not Ordinarily Resident (RNOR)
3. Non-Resident Indian (NRI)

Your tax residency determines what income is taxed. Let’s break it down.

1. Resident

If you’re in India for 182 days or more in a financial year (April to March), you’re a resident. However, you can also become a resident if:

 

• You spend 60 days or more in India this year, and
• You’ve spent 365 days or more in India over the last 4 financial years.

Example: Imagine you live in the UK and spend 58 days in India this year. But if you stay longer—attend that family wedding and cross the 60-day mark—and you’ve already spent 365 days in India over the past 4 years, you’re a resident for tax purposes. This means India can tax your global income, not just your Indian income.

What to Keep in Mind

To keep your NRI status:

 

1. Stay less than 60 days in any financial year.
2. If you have to exceed 60 days, make sure:You’ve spent less than 365 days over the last 4 financial years, andYou stay under 182 days this year.

Failing these criteria makes you a resident and opens up your global income to Indian taxes.

2. Resident but Not Ordinarily Resident (RNOR)

If you end up as a resident, there’s still a way to avoid taxes on your global income through RNOR status.

You qualify as RNOR if:

 

• You’ve been an NRI for 9 out of the last 10 financial years, or
• You’ve spent less than 729 days in India over the last 7 years.

Example continued: Suppose you attend the wedding, stay over 60 days, and have spent more than 365 days in India over the last 4 years—making you a resident. If you also meet the RNOR criteria (less than 729 days in India in the last 7 years or have been an NRI for 9 of the last 10 years), you can still avoid taxes on your global income unless it’s linked to a business or profession controlled from India.

3. Non-Resident Indian (NRI)

To remain an NRI—which means you’re only taxed on income earned in India—you need to:

 

• Stay less than 60 days in India during the financial year, or
• Ensure that if you exceed 60 days, you meet the 365-day limit over the last 4 years and stay under 182 days this year.

Failing any of these makes you a resident for tax purposes.

Another Scenario: Long-Term Stay

If you spend 200 days in India this year, you’ll automatically be classified as a resident since you’ve exceeded the 182-day threshold. India would then tax your global income, including your salary from abroad.

Important: If you’re close to staying more than 60 days, track your cumulative days in India over the last 4 years, and ensure you stay under 182 days this year to avoid losing your NRI status.

Why This Matters

Understanding these rules is crucial for NRIs. It’s not just about staying under 182 days—you also need to monitor your stay over the last 4 financial years. If you exceed 60 days, make sure you meet the 365-day limit and stay under 182 days this year. If you qualify for RNOR status, you may still escape taxes on global income.

Final Thoughts

Tax residency rules can be tricky, and exceeding limits can result in your global income being taxed. Plan your stay carefully, and consult a tax advisor if needed.

Note: Many NRIs returned to India after COVID and stayed for extended periods while working remotely. This could impact your tax residency and liabilities, so it’s best to consult a tax expert when planning travel to and from India.

 

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Disclaimer: The information provided in this article regarding NRI tax residency and related regulations is intended for general informational purposes only and does not constitute professional advice. The data and explanations shared are based on publicly available information and applicable regulations at the time of writing. While reasonable efforts have been made to ensure the accuracy of the information, the Author does not guarantee its completeness or accuracy.

The Author is not a registered tax advisor, and the content of this article should not be construed as tax advice. No legal or financial decision should be made solely based on the information provided herein. The information provided is meant to help readers better understand the general tax residency rules applicable to NRIs, but individual circumstances may vary.

It is strongly recommended that readers consult a qualified tax consultant or legal advisor to assess their personal situation before making any decisions related to their tax status or liabilities.

The Author or any of their associates or employees shall not be responsible for any loss or damage that may arise to any person relying on this article.

 

 

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