I worked in a foreign country for two months and received a salary. I paid tax on that income to that country. For the rest of the year, I received a salary in India except those two months. Now, am I supposed to pay tax in India for that income as a Resident and Ordinarily Resident (ROR)?






Maneesh Maneesh
Answered on February 05,2020

Firstly, you must establish your residential status in India as per the Income-tax Act. You can test your residential status in the following manner. You must meet any of the following conditions and both the additional conditions:

Conditions: a) you are in India for 182 days or more in a financial year (FY); or b) you are in India for 60 days or more in the FY and 365 days or more in the four FYs immediately preceding the relevant FY. Additional conditions: you are resident in India in two of the 10 FYs immediately preceding the relevant FY; and you are in India in the seven years immediately preceding the relevant FY for 729 days or more. If you meet any of the first set of conditions and both the additional conditions, you shall be considered a resident in India. If you meet any of the first conditions but do not meet the additional conditions, you shall be considered a resident but not ordinarily resident (RNOR) in India. If you do not meet any of the first conditions, you shall be a non-resident in India. If an individual leaves India for employment during an FY, he will qualify as a resident of India only if he stays in India for 182 days or more. This otherwise means, condition (b) above of 60 days would not apply to him. Assuming that you have worked and lived outside India only for two months in the financial year and your residential status as per the Income-tax act is that of a resident and ordinarily resident in India, your entire global income shall be taxable in India. You must report this income in your income tax return. Tax shall be calculated on your total income for the financial year, which includes your income from foreign sources. To avoid paying tax twice on the same income and to claim credit of foreign taxes paid, you must refer to the Double Tax Avoidance Agreement between India and the said foreign country.


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