RNOR FAQ – Resident but Not Ordinarily Resident Explained
RNOR (Resident but Not Ordinarily Resident) is one of the most misunderstood residential statuses under Indian tax law. This FAQ answers the most common questions NRIs and returning Indians have about RNOR.
What does RNOR mean?
RNOR stands for Resident but Not Ordinarily Resident. It is a
special transitional tax status that applies mainly to individuals returning
to India after a long period abroad.
Who qualifies as RNOR?
You may qualify as RNOR if:
- You are a Resident in the current financial year, AND
- You were a Non-Resident in at least 9 out of the previous 10 years, OR
- You stayed in India for 729 days or less during the previous 7 years.
How long does RNOR status last?
RNOR typically lasts for 1–2 financial years after you return to India, depending
on your travel and stay history.
Is foreign income taxable during RNOR?
Generally, foreign income earned and received outside India is not taxable
during RNOR, unless it comes from a business controlled in India.
Is foreign salary taxable in India for RNOR?
If foreign salary is earned and received outside India and not linked to a
business controlled from India, it is generally not taxable during RNOR.
Do I need to report foreign assets during RNOR?
Usually no. Disclosure of foreign assets (Schedule FA in ITR) is generally required only for full
Residents (ROR), not for RNOR.
Can I have NRE and NRO accounts during RNOR?
Banking status is governed by FEMA, not Income Tax law. You may need to
redesignate NRE accounts to Resident accounts once your intention is to stay
in India permanently, even if your tax status is RNOR.
Is RNOR the same as NRI?
No. NRI means non-resident (living outside India), while RNOR means resident (living in India) with limited tax exposure.
RNOR is a transitional status between NRI and Resident.
Can RNOR status be planned?
Yes. With proper tracking of travel days and timing of return, many NRIs can
legally benefit from RNOR status.
What happens after RNOR ends?
After RNOR ends, you become a full Resident (ROR), and your global income may
become taxable in India.
How do I check if I qualify as RNOR?
RNOR depends on your stay history over multiple years. Manual calculation is error-prone.
Common Mistakes About RNOR
- Assuming RNOR lasts automatically without tracking days.
- Receiving foreign income in India without planning.
- Not considering business control location.
- Mixing FEMA and Income Tax rules.
More Useful Resources
Conclusion
RNOR is a valuable but time-limited opportunity for returning NRIs. Understanding how it works helps you avoid unnecessary tax and compliance issues.