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How is the residential status of an individual determined for the assessment year 2021-22? Also, explain both the categories of determining the residential status of an individual where he/ she will be treated as Resident but not ordinarily resident.?
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How is the residential status of an individual determined for the asse...
Residential status of an individual for the assessment year 2021-22 can be determined based on the following criteria:
1. Residential Status based on the number of days of stay in India:
- If an individual stays for more than 182 days in India during the financial year, he/she will be considered a Resident.
- If an individual stays for 120 days or more but less than 182 days in India during the financial year and has stayed for 365 days or more in the preceding four years, he/she will be considered a Resident.
- If an individual stays for less than 120 days in India during the financial year and has stayed for 365 days or more in the preceding four years, he/she will be considered a Non-Resident.
2. Residential Status based on the nature of employment:
- An individual who is a citizen of India and leaves India for the purpose of employment outside India during the financial year will be considered a Non-Resident.
- An individual who is not a citizen of India and comes to India for the purpose of employment during the financial year will be considered a Resident if the stay exceeds 182 days.
Resident but not ordinarily resident:
An individual who is a Resident but not ordinarily resident (RNOR) is someone who meets either of the following conditions:
- He/she has been a Non-Resident in India for nine out of the ten financial years preceding the year of assessment.
- He/she has stayed in India for less than 729 days in the preceding seven financial years.
The RNOR status is relevant for taxation purposes as such individuals are not taxed on their foreign income, but only on their income earned in India. However, this status is only applicable for a limited period after an individual returns to India after living abroad and becomes a Resident again.
In conclusion, an individual's residential status can be determined based on the number of days of stay in India and the nature of employment. The RNOR status is applicable for individuals who have spent a significant amount of time living abroad and have returned to India.
1. Residential Status based on the number of days of stay in India:
- If an individual stays for more than 182 days in India during the financial year, he/she will be considered a Resident.
- If an individual stays for 120 days or more but less than 182 days in India during the financial year and has stayed for 365 days or more in the preceding four years, he/she will be considered a Resident.
- If an individual stays for less than 120 days in India during the financial year and has stayed for 365 days or more in the preceding four years, he/she will be considered a Non-Resident.
2. Residential Status based on the nature of employment:
- An individual who is a citizen of India and leaves India for the purpose of employment outside India during the financial year will be considered a Non-Resident.
- An individual who is not a citizen of India and comes to India for the purpose of employment during the financial year will be considered a Resident if the stay exceeds 182 days.
Resident but not ordinarily resident:
An individual who is a Resident but not ordinarily resident (RNOR) is someone who meets either of the following conditions:
- He/she has been a Non-Resident in India for nine out of the ten financial years preceding the year of assessment.
- He/she has stayed in India for less than 729 days in the preceding seven financial years.
The RNOR status is relevant for taxation purposes as such individuals are not taxed on their foreign income, but only on their income earned in India. However, this status is only applicable for a limited period after an individual returns to India after living abroad and becomes a Resident again.
In conclusion, an individual's residential status can be determined based on the number of days of stay in India and the nature of employment. The RNOR status is applicable for individuals who have spent a significant amount of time living abroad and have returned to India.
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How is the residential status of an individual determined for the assessment year 2021-22? Also, explain both the categories of determining the residential status of an individual where he/ she will be treated as Resident but not ordinarily resident.?
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How is the residential status of an individual determined for the assessment year 2021-22? Also, explain both the categories of determining the residential status of an individual where he/ she will be treated as Resident but not ordinarily resident.? for B Com 2024 is part of B Com preparation. The Question and answers have been prepared according to the B Com exam syllabus. Information about How is the residential status of an individual determined for the assessment year 2021-22? Also, explain both the categories of determining the residential status of an individual where he/ she will be treated as Resident but not ordinarily resident.? covers all topics & solutions for B Com 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for How is the residential status of an individual determined for the assessment year 2021-22? Also, explain both the categories of determining the residential status of an individual where he/ she will be treated as Resident but not ordinarily resident.?.
How is the residential status of an individual determined for the assessment year 2021-22? Also, explain both the categories of determining the residential status of an individual where he/ she will be treated as Resident but not ordinarily resident.? for B Com 2024 is part of B Com preparation. The Question and answers have been prepared according to the B Com exam syllabus. Information about How is the residential status of an individual determined for the assessment year 2021-22? Also, explain both the categories of determining the residential status of an individual where he/ she will be treated as Resident but not ordinarily resident.? covers all topics & solutions for B Com 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for How is the residential status of an individual determined for the assessment year 2021-22? Also, explain both the categories of determining the residential status of an individual where he/ she will be treated as Resident but not ordinarily resident.?.
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