What Benefit Is Available To Indian Citizen While Deciding Residential Status?
I was working in India all the while till July 2007 and moved to Singapore on employment in August 2007. So, for FY2007-08, I would have stayed 5 months in India and 7 months in Singapore. The rules at one place seem to suggest that "If I'm out of India for more than 183 days, then I'm a NRI", while in the next sub-clause it seems to suggest that "If I've stayed for more than 365 days in the preceding 5 years, then I'm a resident" In the above case of mine, both are true ... !!! So now for the next assessment year, what am I as per the Income Tax Rules - Resident or NRI ... ? Does it make me liable to pay tax in India for income in Singapore ... ? Manish Bapat, Singapore
The law of residency is given in section 6 of the I T Act .The said section provides as under
1) An individual is said to be resident in India in any previous year, if he
(a) is in India in that year for a period or periods amounting in all to one hundred and eighty-two days or more ; or
(b) deleted
(c) having within the four years preceding that year been in India for a period or periods amounting in all to three hundred and sixty-five days or more, is in India for a period or periods amounting in all to sixty days or more in that year.
Explanation.In the case of an individual,
(a) being a citizen of India, who leaves India in any previous year as a member of the crew of an Indian ship as defined in clause (18) of section 3 of the Merchant Shipping Act, 1958 (44 of 1958), or for the purposes of employment outside India, the provisions of sub-clause (c) shall apply in relation to that year as if for the words sixty days, occurring therein, the words one hundred and eighty-two days had been substituted ;
In simple words , the provision under section 6(1) states that a person is resident in India if he satisfies any one of the following two conditions :
1. He is in India for 182 days in that year
Or
2. He is in India for 6o days in that year and a total of 365 days in preceding four years .
In your case , you lived in FY 2007-08 in India for more than 60 days and for more than 365 days between (2003-04 to 2006-07). So you are fulfilling the 2nd condition. As such you should have status RESIDENT for FY 2007-08.But since you are Indian citizen , you are fortunate.
As per the Explanation (a) under section 6 the word sixty days in second condition does not apply to any Indian who leaves India for EMPLOYMENT. For such Indian who leaves India for EMPLOYMENT or as Crew member of Indian ship , sixty days means one hundred eight two days.
Since, in your case both conditions are not fulfilled for FY 2007-08 , as you were not in India for 182 days or more.
Why don't you try this residency calculator.
Taxability of your income during FY 2007-08
You have not given complete details about your income, therefore I presume that you are at present earning income which has no relationship with India. On that presumption, simple answer to your question is this:
Income earned upto July 2007 shall be taxable in India if it is above exemption limit.
Income earned totally outside India shall not be liable to be taxed in India .
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