NRI residential status in 2026: the 182-day, 120-day and deemed-resident rules

Your residential status in India depends mainly on how many days you spend here in a tax year (1 April to 31 March). Stay 182 days or more and you are resident. Below that, a second test of 60 days in the year plus 365 days over the previous four years can still make you resident. NRIs who visit or leave for work get relief from it.

The Income-tax Act, 2025 took effect on 1 April 2026. It moved the rules into Section 6 of the new Act but kept their substance unchanged. Tax year 2026-27 is the first year tested under the new law. FY 2025-26 and earlier years are still governed by Section 6 of the 1961 Act.

Why your status matters

A non-resident pays Indian tax only on income earned or received in India. Rent from a flat in Pune, interest on an NRO deposit and gains on Indian shares are all in. Your foreign salary is not.

A resident and ordinarily resident person is taxed on worldwide income. That is the outcome most NRIs want to avoid. A middle category, resident but not ordinarily resident (RNOR, called “not ordinarily resident” in the Act), is taxed broadly like a non-resident on foreign income.

Status is fixed separately for each tax year. Being non-resident last year does not carry over.

The two basic tests

Under Section 6(2) of the 2025 Act (Section 6(1) of the 1961 Act), an individual is resident in a tax year if either condition is met:

182-day test: in India for 182 days or more during the year.
60 + 365 test: in India for 60 days or more during the year, and 365 days or more in total across the four preceding tax years.

Meet neither and you are non-resident. Most NRIs who work abroad and visit for a few weeks each year fail both and stay non-resident.

The modifications for NRIs

The 60 + 365 test would catch many NRIs who visit family often. The law therefore switches it off, or changes it, in three situations.

Who you are	Test that applies	Section (2025 Act)
Indian citizen leaving India in the year for employment abroad, or as crew of an Indian ship	182 days only	6(3)
Indian citizen or person of Indian origin (PIO) visiting India, Indian income up to Rs 15 lakh	182 days only	6(4)
Citizen or PIO visiting India, Indian income above Rs 15 lakh	182 days, or 120 days plus 365 days in four preceding years	6(5)
Indian citizen, Indian income above Rs 15 lakh, not liable to tax in any country	Deemed resident, days irrelevant	6(7)

“Indian income” here means total income excluding income from foreign sources. Foreign-source income is defined in Section 6(14). It covers income arising outside India, unless it comes from a business controlled in India or a profession set up in India.

Leaving India for a job

In the year you leave for overseas employment, only the 182-day test applies. If you leave early enough in the year to stay below 182 days, you are non-resident for that whole year.

Visiting India

Once you live abroad, your trips home count as visits. With Indian income up to Rs 15 lakh, you can spend up to 181 days in India and remain non-resident.

The 120-day rule for higher Indian income

If your Indian income exceeds Rs 15 lakh, the 60-day figure becomes 120 days. So 120 days or more in the year, plus 365 days over the previous four years, makes you resident.

The softening is that such a person is automatically treated as not ordinarily resident under Section 6(13)(b). Foreign salary and foreign investment income therefore stay outside Indian tax. The 2025 Act states this directly: a citizen or PIO with over Rs 15 lakh of Indian income who spends 120 to 181 days in India is NOR.

Deemed residency: the “stateless taxpayer” rule

Section 6(7) of the 2025 Act (Section 6(1A) of the 1961 Act) targets Indian citizens who pay tax nowhere. You are deemed resident if all three conditions apply:

you are an Indian citizen;
your total income, excluding foreign-source income, exceeds Rs 15 lakh;
you are not liable to tax in any other country because of domicile, residence or a similar criterion.

The number of days you spend in India does not matter. A deemed resident is also treated as not ordinarily resident under Section 6(13)(c). In practice, that means Indian income is taxed but foreign earnings generally are not, unless they come from an Indian business or profession.

The UAE and Gulf angle

The UAE, Qatar, Bahrain and some other Gulf states do not levy personal income tax on salaries. That raised concern in 2020 that Gulf-based Indians would be swept in as deemed residents.

The government issued a clarification on 2 February 2020. It said the rule was an anti-abuse measure. It was not meant to tax the overseas earnings of bona fide workers in the Middle East. It added that a deemed resident’s foreign income is taxed only if it comes from an Indian business or profession.

For a Gulf-based NRI, the deemed-resident rule matters mainly when Indian income crosses Rs 15 lakh. Large property sales or rental portfolios can push you over. Keep a tax residency certificate from your country of residence; it helps show where you are treated as resident.

How days are counted

The Act counts days of physical presence in India. Citizenship, domicile, visa type and where your family lives do not change the count.

The law does not clearly settle how to treat the day you land and the day you fly out. Tax officers often count both as days in India. At least one tribunal has excluded the arrival day, holding that a part day need not count. That was the Ahmedabad bench in Pradeep Kumar Joshi v. ITO.

The safer approach is to plan as if both travel days count. Then keep a margin of a few days below any threshold.

Practical points for your count:

Count every trip in the tax year, not just the long one.
Use passport stamps or immigration records rather than memory.
Keep boarding passes and tickets for each trip. They settle disputes about exact dates.

Worked examples

Example 1: a visitor with modest Indian income

Priya is an Indian citizen who has worked in New Jersey since 2015. Her Indian income is rent of Rs 4.8 lakh and NRO interest of Rs 1.2 lakh, so Rs 6 lakh in total.

In tax year 2026-27 she spends 150 days in India caring for a parent. She spent 400 days in India across the previous four years.

She is over 60 days and over 365 days, so the plain 60 + 365 test would make her resident. But she is a citizen on a visit with Indian income under Rs 15 lakh. Only the 182-day test applies, and 150 is below 182. She is non-resident.

Example 2: a Dubai resident with high Indian income

Rakesh, an Indian citizen, lives in Dubai. In tax year 2026-27 his Indian income is Rs 22 lakh, from rent and a capital gain on shares. He spends 130 days in India and spent 380 days here over the previous four years.

Because his Indian income exceeds Rs 15 lakh, the 120-day test applies. He has 130 days (at least 120) and 380 days (at least 365), so he is resident.

Because he falls between 120 and 181 days, he is not ordinarily resident under Section 6(13)(b). His Dubai salary remains outside Indian tax. His Rs 22 lakh of Indian income is taxed as before.

At 119 days he would escape the day-count tests. But he pays no income tax in the UAE and has over Rs 15 lakh of Indian income. So he could still be deemed resident under Section 6(7). Either way, he is NOR and his Dubai salary stays outside Indian tax.

Example 3: leaving India for a job

Ankit takes a job in Singapore. Counting both travel days, his days in India in 2026-27 depend on his flight date:

Last day in India	Days in India in 2026-27	Status
28 September 2026	181	Non-resident
29 September 2026	182	Resident
5 October 2026	188	Resident

As a citizen leaving for employment, only the 182-day test applies to him. Moving his flight by a single day changes his status for the whole year.

A recent ruling to watch

In January 2026, the Bengaluru tribunal ruled on Flipkart co-founder Binny Bansal’s residency. It held that the relaxation for citizens “coming on a visit” helps only people who were already non-resident.

He had lived in India for years and then moved abroad. In 2019-20 he spent 141 days in India. The tribunal applied the plain 60 + 365 test and held him resident.

The ruling may be challenged in a higher court. Until then, people in their first years abroad should be cautious about long visits home. This is a situation where a chartered accountant’s view on your own facts is worth getting.

Common mistakes

Counting only the long trip. Short visits for weddings or paperwork add up across the year.
Ignoring the Rs 15 lakh line. A one-off property sale can push Indian income over Rs 15 lakh. That brings in the 120-day test, or deemed residency, for that year.
Assuming last year’s status carries forward. Each tax year is tested separately.
Confusing tax residency with FEMA residency. Your bank account type follows FEMA rules, which work differently from the day-count tests.
Relying on a foreign residence visa alone. A UAE or US residence permit does not by itself make you non-resident in India. Days in India decide it.
Using the wrong year’s law. Status for FY 2025-26 is decided under the 1961 Act. Tax year 2026-27 onward uses the 2025 Act, with the same tests.

What to do next

Run your own day count and income figures through the residential status calculator.
Resident in two countries? Check the tie-breaker rules with the DTAA finder and read DTAA benefits, TRC and Form 10F.
Planning to move back? See RNOR status for returning NRIs.
For the wider changes under the new law, read what the Income-tax Act, 2025 changes for NRIs.
Check whether you need to file at all in Do NRIs need to file an ITR in India?

Sources

This guide explains the rules as they stood on 25 October 2026. It is general information, not tax, legal or financial advice. Rules change, and individual cases have exceptions, so confirm your position with a chartered accountant before acting. Spotted an error? Tell us and we will correct it.