RNOR status: what the window shelters, and how long yours lasts
A transitional grade of residence between non-resident and fully resident. You do not apply for it — it follows from day counts, and it expires quietly.
It is a transitional status between non-resident and fully resident. While you hold it, foreign income generally stays outside Indian tax unless it comes from a business controlled from India. It usually lasts two to three years after you return, and the exact length depends on how long you were away.
If you miss it: Nothing announces the end. From the first fully resident year your worldwide income is within the Indian charge, and that is the year people are caught — with foreign interest undeclared or a disposal made in the belief it was still sheltered.
s. 6(6) up to 2025-26 · s. 6(13) from 2026-27 · checked 10 September 2026
Key takeaways
- You do not choose it and you do not apply for it. It follows from day counts, and it is worked out year by year.
- It is worth real money: foreign interest, foreign dividends, foreign pensions and gains on foreign assets generally stay out of Indian tax while it lasts.
- It is not a shelter for Indian income. Anything arising in India is taxed exactly as it would be for anyone else.
- It ends quietly. Nobody tells you, and the first full-resident year is where people get caught.
- Foreign asset reporting is a separate question from taxability, and getting that wrong is expensive independently.
The Income-tax Act, 2025 replaced the Income-tax Act, 1961 on 1 April 2026 and renumbered almost everything. It did not renumber your notice. Under the repeal-and-savings provision, an assessment, reassessment, appeal or penalty for a tax year before 1 April 2026 stays under the 1961 Act — even where the notice itself arrives after that date. So the number that governs the letter in your hand is decided by the year the letter is about, not by the date it was posted. Both numbers are given on every page here, with the governing one first.
“The provisions of the repealed Income-tax Act shall continue to apply to any proceeding pending on the date of commencement of this Act and to any proceedings initiated on or after the 1st April, 2026 (including notices, assessment, reassessment, recomputation, rectification, penalty, reference, revision and appeals) in respect of any tax year beginning before the 1st April, 2026.”
- Notice about 2025-26 or earlier
- The Income-tax Act, 1961 numbering is the one that governs it — s. 143(2), s. 156, s. 220, Form 26AS, Form 16. That is most letters arriving in 2026.
- Notice about 2026-27 or later
- The Income-tax Act, 2025 numbering governs — s. 270(8), s. 289, s. 411, Form 168, Form 130. In practice, letters from 2027 onward.
What the status actually is
Indian residence for tax comes in three grades, not two. You are a non-resident, or you are resident and ordinarily resident, or you sit in between as resident but not ordinarily resident — the status this page is about.
The point of the middle grade is that somebody returning after years abroad should not be taxed on their entire worldwide position from the day they land. So the law gives a transitional period during which Indian income is taxed normally but foreign income largely is not, and full worldwide taxation begins only once you have been back long enough to be treated as properly settled.
It is not a concession you apply for, and there is no certificate. It follows from arithmetic on how many days you have spent in India across past years, and it is determined afresh for each tax year — so it is perfectly ordinary to be RNOR for one year, RNOR again for a second, and ordinarily resident for the third.
For tax year 2025-26 and earlier the status sits in section 6(6) of the Income-tax Act, 1961. From tax year 2026-27 it is section 6(13) of the Income-tax Act, 2025. The tests are unchanged; only the numbering moved. As everywhere else on this cluster, the year decides which number applies.
How the status is worked out
You are resident but not ordinarily resident for a year if you are resident for that year and satisfy either of two tests. Either one is enough — they are alternatives, not conditions to be met together, which is the single most common misunderstanding on this subject.
- There is a further route into the status for an Indian citizen or person of Indian origin whose Indian income exceeds ₹15 lakh and who is in India for 120 days or more but less than 182 days in the year.
- Day counting is on physical presence, and part days generally count. Keep a record — passport stamps, boarding passes, entry and exit records — because the arithmetic is only as good as the dates behind it.
- The tests look backwards over different windows, ten years and seven years, so the answer can change between two consecutive years without anything about your behaviour changing.
| Test | What it asks | Satisfying it means |
|---|---|---|
| The nine-in-ten test | Were you a non-resident in India in nine out of the ten tax years preceding this one? | RNOR for this year |
| The 729-day test | Were you in India for 729 days or less across the seven tax years preceding this one? | RNOR for this year |
Either test on its own is sufficient. You also have to be resident for the year in question — the status is a grade of residence, not an alternative to it.
What the status is actually worth
This is the part the ranking pages skip, and it is the reason anybody should care. The status is not an administrative label — it is a period during which a specific category of income stays outside Indian tax.
| Income | Non-resident | RNOR | Ordinarily resident |
|---|---|---|---|
| Arising in India | Taxed | Taxed | Taxed |
| Received in India | Taxed | Taxed | Taxed |
| Foreign income, from a business controlled from India | Not taxed | Taxed | Taxed |
| Other foreign income — interest, dividends, pension, rent, gains | Not taxed | Not taxed | Taxed |
The third row is the exception people miss: a business or profession controlled from or set up in India does not get the shelter, even though the income is foreign.
For someone returning with a foreign retirement account, a portfolio, a let property abroad or accrued deferred compensation, two or three years of shelter on the income from all of it is frequently the largest single tax consideration of the move. It is also the shortest-lived, which is why the planning has to happen at the start of the window rather than when it is closing.
What the window is for
A period during which foreign income is largely untaxed is a period in which certain decisions are considerably cheaper than they will be afterwards. What is appropriate depends entirely on your own position and on the law of the other country, which is why this is a list of things to take advice about rather than a list of things to do.
- The timing of realising gains on foreign assets, where a disposal inside the window is treated differently from one outside it.
- The timing of drawing on foreign retirement accounts, which frequently have their own rules in the country holding them and can be taxed very differently either side of the line.
- Whether foreign accounts and holdings should be simplified before the reporting obligations of full residence begin.
- Where deferred compensation from a foreign employer will vest or be paid, relative to the end of the window.
- Whether a foreign business is in fact controlled from India, because that determination removes the shelter from its income.
Nothing on this page is about your tax position where you came from. A disposal that is untaxed in India while you are RNOR may be fully taxable in the other country, and a treaty may or may not help. Anyone treating the window as an unqualified opportunity without looking at both sides is looking at half the problem.
Reporting is a separate question from taxability
This is where the status most often costs people money, and it is not through the tax at all.
Whether foreign income is taxable and whether foreign assets have to be disclosed are two different questions with two different answers. The reporting obligations that attach to full residence — schedules of foreign assets, foreign accounts, foreign holdings — are not switched off merely because the income from them is outside the charge, and the penalties attaching to non-disclosure of foreign assets are severe and largely independent of how much tax was at stake.
So the safe working assumption for anyone returning with anything abroad is: taxability and disclosure are answered separately, and an accountant should be asked about both. Not asking is the commonest and most expensive mistake in this whole subject.
It ends without anybody telling you
There is no notice, no letter and no change on any portal. One year the arithmetic simply stops producing the status, and from that year your worldwide income is within the Indian charge.
Because both tests look backwards over fixed windows, the end date is usually predictable from the day you return — which means the single most useful thing you can do on arriving is to work out, once, which year will be your first fully resident year, and write it down.
The year people get caught is that first ordinarily resident year, because the habits of the previous two are still in place: foreign interest not declared, a foreign account not reported, a disposal made in the belief it was still sheltered. And the information reaches the department anyway, through international exchange of financial account information, which is why this is not a risk worth running.
Worked examples
Example 1: Returning after twelve years abroad
- Left India
- 2014
- Returned
- During 2026-27
- Years abroad
- Twelve, with only short visits
- Resident for 2026-27?
- Yes, on days present
- 1.Resident for the year, so the question is which grade of residence.
- 2.The nine-in-ten test: non-resident in nine of the ten preceding years — comfortably satisfied after twelve years away.
- 3.That alone is enough. The 729-day test does not need to be reached.
- 4.So RNOR for 2026-27, and the same arithmetic is repeated for 2027-28 and each year after.
Foreign interest, dividends, pension and gains stay outside the Indian charge for the year, while anything arising in India is taxed normally. Working out now which year the status will lapse is the thing to do with the information.
Example 2: The same person, two years later
- Year
- 2028-29
- In India continuously since
- 2026-27
- Nine-in-ten test
- Now failing — two of the last ten years resident
- 729-day test
- Needs checking
- 1.The nine-in-ten test looks at the ten preceding years. Two of those are now resident years, so nine of ten are no longer non-resident — but that still leaves eight, so the test fails only once three of the ten are resident years.
- 2.The 729-day test looks at the seven preceding years. Two full years in India is roughly 730 days on its own, so this test is on the edge and the exact day count decides it.
- 3.The two tests can therefore diverge, and either one satisfied is enough.
- 4.So the arithmetic has to be done properly rather than assumed, and the day records are what it rests on.
This is why "RNOR lasts two to three years" is a rule of thumb rather than a rule. The exact length depends on the day counts, and the difference between the second and third year is often a handful of days spent in India during the years abroad.
Example 3: A foreign business that was controlled from India
- Status
- RNOR
- Income
- Profits of a consultancy incorporated abroad
- Where decisions were made
- India, after the return
- 1.The shelter covers foreign income generally, but not income from a business or profession controlled from or set up in India.
- 2.Where the returning individual is making the decisions from India, the business is capable of being treated as controlled from India even though it is incorporated elsewhere.
- 3.That takes the income out of the shelter, and it is taxable in the RNOR year exactly as it would be for a fully resident person.
- 4.It is a question of fact about where control is exercised, not about where the entity is registered.
The exception most often missed, because the income looks foreign in every other respect. Anyone returning while continuing to run something abroad should establish this position early rather than assume the shelter applies.
More questions about this page
What does RNOR mean?▼
How long does RNOR status last?▼
How do I know if I qualify as RNOR?▼
Do I have to apply for RNOR status?▼
Is foreign income taxable for an RNOR?▼
Does RNOR status shelter my Indian income?▼
Do I still have to report foreign assets as an RNOR?▼
Which section covers RNOR — 6(6) or 6(13)?▼
What should I do while I still have RNOR status?▼
What happens when RNOR status ends?▼
Official sources checked
The statutes, rules and regulator pages the statements on this page were checked against.
- Defines not ordinarily resident on two alternative tests: non-resident in nine out of the ten preceding tax years, or in India for 729 days or less across the seven preceding tax years. Applies from tax year 2026-27.
- Income-tax Act, 1961 — s. 6(6)The predecessor provision, governing tax year 2025-26 and earlier. The tests are the same.
- Income-tax Act, 2025 — the scope of total income by residential statusThe basis on which foreign income is outside the charge for a not ordinarily resident person, save for income from a business or profession controlled from or set up in India.
You are here
Working out your residential status after returning to India, and what it shelters
What to do next
- 1
If income from the other country is still being taxed there
Treaty relief runs on its own documents, and they have to be in place before a payment rather than after it.
Form 10F, now Form 41 → - 2
If you are selling Indian property while abroad
The buyer withholds against the whole sale price rather than your gain — often five to ten times the real liability.
Lower TDS certificate → - 3
If money is moving out of India
Four Parts, three questions, and a threshold measured on the year rather than the transfer.
Form 15CA, now Form 145 → - 4
If a notice has arrived about a year when your status was changing
Eight notice types, matched by what the letter says rather than by the section number on it.
Which income tax notice is this? →
This page is general information about procedure and deadlines, checked against the provisions in force on the date shown. It is not advice on your own assessment, and a notice that looks routine can turn on facts a page cannot see. Where money or a limitation period is at stake, put the notice in front of a practising Chartered Accountant.