The Rule That Defines When an Indian Becomes a Non-Resident?

Most people think taxation in India is only about where you earn money.
Not quite.
It’s also about where you actually live — or more precisely, how long you stay here.

That’s why your residential status becomes so crucial under the Income Tax Act, 1961. And one small but powerful clause — Section 6(6) — decides if you’ll be treated as a Resident & Ordinarily Resident (ROR) or a Resident but Not Ordinarily Resident (RNOR).

In Short: this section decides how India will tax people who live partly abroad, partly here.

Understanding the Basics: Section 6 of the Act

Section 6 is the rulebook that defines when an individual, an HUF, a company, or a firm is considered resident in India.
Among all its sub-clauses, Section 6(6) goes a step further — it splits residents into two baskets based on how closely they’re tied to India.

So it works in two layers:

1. Section 6(1) → tells if you’re resident or non-resident.
2. Section 6(6) → tells what kind of resident you are."

That’s where most people get confused.

What Exactly Does Section 6(6) Say?

It simply lays down when a person will be:

• Resident & Ordinarily Resident (ROR), or
• Resident but Not Ordinarily Resident (RNOR).

This matters because it decides what portion of your income—whether earned in India or abroad—gets taxed here.

Also Read: Do You Qualify as a Resident? Discover How a Simple Clause Can Decide Your Tax Fate

How You Become a Resident – Section 6(1)

Before you jump to 6(6), check if you qualify as a Resident in the first place.
You’re a Resident if you satisfy any one of these two:

• You stayed in India for 182 days or more during the financial year, or
• You stayed for 60 days in that year 365 days in the 4 years before it.

There’s an exception though. For Indian citizens or Persons of Indian Origin (PIOs) who live abroad, the 60-day rule is relaxed to 182 days, depending on their Indian income.

Once you cross that line, Section 6(6) kicks in.

Resident & Ordinarily Resident (ROR) vs RNOR

You’re an ROR only if both these are true:

1. You were a Resident in at least 2 of the last 10 years, and
2. You’ve been in India for 730 days or more in the last 7 years.

If not → you become RNOR.

Key impact:

• RORs → taxed on global income.
• RNORs → taxed only on income earned or received in India.

Example — Riya’s Case

Take Riya, an Indian citizen working abroad who visits India often."
She spent 190 days here in FY 2024-25. That makes her a Resident.

Now we check Section 6(6):

• In the past 10 years, she was resident only once.
• Total stay in last 7 years = 500 days.

Since she doesn’t meet both conditions → she’s RNOR.
So her foreign salary stays tax-free in India; only her Indian earnings are taxed.

Tax Exposure Based on Status

That single classification under Section 6(6) changes your entire tax picture.

Also Read: Section 6(1)(c) of Income Tax Act: Resident Status

 Why 182 Days Matter So Much

That one number—182 days—isn’t random.
It’s a global benchmark. Most countries use it to decide when a visitor becomes a resident for tax purposes.

In India, it draws a clear line:

• Stay < 182 days → Non-Resident
• Stay ≥ 182 days → Resident

After that, Section 6(6) decides if you’re ROR or RNOR.

HUFs Under Section 6(6)

The same rule applies to HUFs (Hindu Undivided Families).

An HUF is ROR if:

• Its Karta was a Resident in at least 2 of the past 10 years, and
• Stayed in India for 730 days or more during the last 7 years.

Otherwise, it’s RNOR.
This keeps joint-family taxation consistent with individual rules.

RNOR: A Safety Net for Returning NRIs

When NRIs move back to India, they don’t instantly get taxed on their global income.
They enjoy RNOR status for a few years.
During that time:

• Foreign income is exempt.
• Only Indian income is taxed.

It’s a breathing space to realign finances & investments without double taxation.

Set-Off and Carry-Forward Effects

Once your residential status is known, other provisions start linking up:

• RORs can set off or carry forward foreign losses against global income.
• RNORs & NRs cannot, since foreign income isn’t taxable here.

So Section 6(6) indirectly controls how much relief you can claim later.

Also Read: Residency Test That Decides If Your Global Income Gets Taxed

2020 Amendment – Deemed Residency

To stop “stateless” cases, the Finance Act 2020 added that:
If an Indian citizen earns over ₹15 lakh (excluding foreign income) & isn’t taxed anywhere else, they can be treated as Resident—but only as RNOR."
This keeps fairness while avoiding double taxation.

Counting Your Days Correctly

Every part of a day in India counts as one full day.
Even arrival & departure days do.
So keep evidence handy — passport stamps, boarding passes, immigration slips.
During scrutiny, these can save you serious trouble.

Case Law: CIT v. K.S. Ratnaswamy (2009)

The court ruled that if the 730-day test isn’t met, the person is RNOR, even if resident under Section 6(1).
So, Section 6(6) isn’t a formality — it’s a rule that defines tax reach.

Foreign Income, Schedule FA & Compliance

• RORs must report all foreign assets, bank accounts, & overseas income under Schedule FA.
• RNORs/NRs don’t, unless that income is received in India.

Miss that, and the Black Money Act can hit you with heavy penalties.

A Practical Tip

If you’re an NRI thinking of spending long months in India — maybe retirement, family, or business — watch your calendar.
Once you touch 182 days, your tax world changes.
A quick consult with a CA before that can save a small fortune later.

Also Read: Relief from Double Taxation for Indian Residents

Key Takeaways

• Section 6(6) splits residents into ROR or RNOR.
• 182 days → primary residency trigger.
• ROR = tax on global income; RNOR = tax on Indian income.
• Also applies to HUFs (based on the Karta).
• RNOR helps returning NRIs transition smoothly.
• Impacts set-off, disclosures, & foreign reporting rules.

Conclusion

Section 6(6) gives India’s tax law a human touch.
It accepts that not every “resident” lives the same way — some have lifelong roots here, others split their time worldwide.
By defining ROR and RNOR so clearly, the law avoids both under-taxation and double taxation.

If you work across borders, travel often, or plan to move back to India, understanding this section is not optional — it’s your best protection against compliance headaches.

Still unsure if you’re ROR or RNOR — or how your foreign income fits in?

Visit CallMyCA.com. Our experienced Chartered Accountants will go through your travel records, confirm your residential status, and help you plan taxes smartly and legally — before the clock resets.