What is Tax Residency?
The residential status of a person for tax purposes generally depends on the period of stay in India during a financial year. The residency rule under the
income tax
law needs a person to be in India during the relevant year for at least 182 days to qualify as a resident. Moreover, in some cases, even presence in India for a total period of 120 or 60 days in a single financial year can make the individual an Indian tax resident, subject to some conditions.
Now you know what is the meaning of tax residency.
Criteria for Different Entities to be Considered a Tax ResidentThere are different criteria for different types of entities.
A partnership firm, HUF (Hindu Undivided Family), or other association of persons is considered a resident in India in any previous year in all cases except where during that year the control and management of its affairs are located completely outside our country.
A company will be considered a resident in India in any previous year, if—
(i) It’s an Indian company; or
(ii) During that year, the control and management of the company’s affairs are located wholly in India (The Parliamentary has approved a statutory amendment looking for a change of this condition to the place of effective management in India and it’s awaiting ratification).
All other types of entities are considered residents in India in any previous year in all cases, except where during that year the control and management of its affairs are located wholly outside India.
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Authors Of The Question
What is tax residency?
Trish
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2022-04-07T17:54:06+00:00 2022-04-08T18:10:04+00:00Comment
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