Generally Speaking the term “Non-resident” means a person who for the year concerned does not reside in India. The determination of the residential status assumes importance in view of the fact that charge of income tax is dependent on the residential status of the assessee.

Whereas Section 4 of Income Tax Act, 1961 creates charge of income tax  on the total income of every person, section 5 which defines the scope of total income restricts the charge of income tax to a person based on his/her residential status.

In India, the residential status of a person under the tax laws is governed by section 6 of the Income Tax Act, 1961. As per the said section three kind of residential status have been defined:
(1) Resident
(2) Non Resident
(3) Resident but Not Ordinarily Resident (RNOR)
(4) Resident and Ordinarily Resident (ROR)

Please note that RNOR is a special status accorded in order to provide some benefits to returning Non Resident Indians (NRIs). RNOR is liable to pay tax in India only on his Indian income. Any income from abroad will not be taxed in India.

Criteria/Rules for ascertaining Residential Status
(a) Resident- An Individual is considered a resident on fulfilling either of the following two conditions:
(a1) If he/she, in the relevant year has stayed in India for a period of 182 days or more,
or;
(a2) He/she in the relevant year, has stayed for 60 or more days in India and also stayed in India for 365 days or more in four preceding years in India
(b) Non-resident A person not fulfilling above criteria is considered a non-resident
(c) Resident but Not Ordinarily Resident An individual is considered as RNOR if he/she fulfills any of the following conditions:
(c1) He/she is a non-resident in India for 9 out of 10 years preceding the year under consideration, or
(c2) He/she, during 7 years preceding to the year under consideration, has been in India for a total period not exceeding 729 days.
(d) resident and ordinarily resident (ROR) In other words, a resident individual will be treated as ROR in India during the year if he satisfies following conditions:
(1) He/she is resident in India for at least 1 years out of 10 years immediately preceding the relevant year,  or
(2) His/her stay in India is for 730 days or more during 7 years immediately preceding the relevant year.

Tax Incidence
As per Section 5, the charge of income tax based on the residential status is as under:

Calculator for Residential Status:
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