Section 6 of the Income-tax Act, 2025 makes an individual resident if in India for 182 days or more, or 60 days in the year with 365 days in the preceding four years. Visiting citizens and persons of Indian origin with income above ₹15 lakh face a 120-day threshold.
What section 6 does
Section 6 is the most consulted provision in cross-border personal tax. It determines residential status, and section 5 then decides how much of a person's income India can tax.
The primary tests for an individual are in sub-section (2): 182 days or more in the tax year, or 60 days or more in the year together with 365 days or more in the four preceding years. The second test is relaxed for Indian citizens leaving for employment or as crew of an Indian ship, and for visiting citizens and persons of Indian origin.
Two thresholds define modern NRI planning. Where a visiting citizen or person of Indian origin has total income above ₹15 lakh (other than foreign source income), the 60-day test becomes a 120-day test. And under sub-section (7), an Indian citizen not liable to tax anywhere with income above ₹15 lakh is deemed resident regardless of days.
The Income-tax Act, 2025 takes effect from 1 April 2026 and applies from tax year 2026-27. The Income-tax Act, 1961 continues to govern every year up to 31 March 2026, including assessments, appeals and penalties for those years, because of the repeal and savings provision in section 536. Figures quoted here are the amounts written into the Act as enacted (with the Gazette corrigenda of 3 September 2025); the annual Finance Act can change rates and thresholds.
Old Act and new Act, side by side
The table below shows what the Income-tax Act, 1961 did and where the same ground is covered in the Income-tax Act, 2025.
| Income-tax Act, 1961 | What it did | Income-tax Act, 2025 |
|---|---|---|
| 6(1)(a) | 182-day test | 6(2)(a) |
| 6(1)(c) | 60 days plus 365 days test | 6(2)(b) |
| 6(1), Explanation 1(a) | Crew and employment abroad relaxation | 6(3) |
| 6(1), Explanation 1(b) | Visiting citizens and persons of Indian origin | 6(4) |
| 6(1), Explanation 1(b), proviso | 120 days where income exceeds ₹15 lakh | 6(5) |
| 6(1A) | Deemed resident — citizen not liable to tax anywhere | 6(7) and 6(8) |
| 6(3) | Company residence and place of effective management | 6(10) |
| 6(6) | Not ordinarily resident | 6(13) |
Section 6 sub-section by sub-section
Read this alongside the bare text — each heading below is a sub-section of the section as enacted.
Sub-section (2) — the two basic tests for an individual
An individual is resident if he (a) is in India for a total period of 182 days or more in that tax year; or (b) is in India cumulatively for 60 days or more during that year and has been in India cumulatively for 365 days or more in the four preceding years. Failing both makes the individual a non-resident.
Sub-sections (3) and (4) — who escapes the 60-day test
Sub-section (2)(b) does not apply to an Indian citizen who leaves India in the tax year (a) as a member of the crew of an Indian ship under the Merchant Shipping Act, 1958, or (b) for the purposes of employment outside India. Nor does it apply — subject to sub-section (5) — to an individual who is an Indian citizen or a person of Indian origin and who, being outside India, comes on a visit to India.
Sub-section (5) — the 120-day rule
Where a person covered by sub-section (4) has total income exceeding ₹15 lakh during the tax year, other than income from foreign sources, sub-section (2)(b) applies as if 'sixty days' read 'one hundred and twenty days'. A high-earning visiting NRI therefore becomes resident at 120 days rather than 182.
Sub-sections (7) and (8) — deemed residence
Irrespective of sub-sections (2) to (6), an individual is deemed to be resident if he (a) is a citizen of India; (b) is not liable to tax in any other country or territory by reason of domicile, residence or similar criteria; and (c) has total income exceeding ₹15 lakh other than income from foreign sources. Sub-section (8) provides that this does not apply to someone already resident under sub-sections (2) to (6).
Sub-sections (9) to (12) — non-individuals
An HUF, firm or other association of persons is resident unless control and management of its affairs is situated wholly outside India. A company is resident if it is an Indian company or its place of effective management is in India — defined as the place where key management and commercial decisions for the conduct of the business as a whole are, in substance, made. Every other person follows the control and management test. And sub-section (12) provides that residence for one source of income makes a person resident for all sources.
Sub-section (13) — not ordinarily resident
A person is not ordinarily resident if: (a) an individual who has been, or an HUF whose manager has been, a non-resident in nine out of the ten preceding tax years, or in India for 729 days or less in the seven preceding tax years; or (b) an Indian citizen or person of Indian origin with income above ₹15 lakh as in sub-section (5) who has been in India for 120 days or more but less than 182 days; or (c) an Indian citizen deemed resident under sub-section (7).
Sub-section (14) — income from foreign sources
Income from foreign sources means income which accrues or arises outside India — except income derived from a business controlled in or a profession set up in India — and which is not deemed to accrue or arise in India. This definition drives the ₹15 lakh tests in sub-sections (5), (7) and (13).
Worked example
An Indian citizen working abroad visits India in tax year 2026-27.
| Facts | Status under section 6 | Why |
|---|---|---|
| In India 150 days; Indian income ₹9,00,000; was in India 400 days in the preceding four years | Non-resident | Below 182 days, and sub-section (4) disapplies the 60-day test for a visiting citizen; income is below ₹15 lakh so sub-section (5) does not bite |
| Same, but Indian income is ₹22,00,000 | Resident, and not ordinarily resident under sub-section (13)(b) | Sub-section (5) reduces the threshold to 120 days; 150 days exceeds it. Because stay is 120 to 182 days with income above ₹15 lakh, sub-section (13)(b) applies |
| In India 40 days; Indian income ₹22,00,000; not liable to tax in any other country | Deemed resident under sub-section (7), and not ordinarily resident under (13)(c) | Citizenship, no tax liability abroad, and income above ₹15 lakh — day count is irrelevant |
| In India 40 days; Indian income ₹22,00,000; tax resident of the UAE and taxed there | Non-resident | Sub-section (7)(b) is not met |
Row two is the practically important one. The individual becomes resident but not ordinarily resident, so under section 5(1)(c) their foreign income stays outside the Indian net unless it comes from a business controlled in or a profession set up in India.
Compliance checklist and due dates
- Count days in India precisely for the tax year and for the four preceding years.
- Check whether the individual left India for employment or as crew of an Indian ship — sub-section (3) removes the 60-day test.
- For visiting citizens and persons of Indian origin, compute total income other than foreign source income against ₹15 lakh to decide between 60 and 120 days.
- Test deemed residence under sub-section (7) independently of day count, and obtain evidence of tax liability abroad where relying on clause (b).
- Determine whether the not-ordinarily-resident category in sub-section (13) applies — it materially narrows the scope under section 5.
- For companies, document where key management and commercial decisions are in substance made, for the place of effective management test.
- Remember sub-section (12): residence for one source makes a person resident for all sources.
Common mistakes
- Applying the 60-day test to an Indian citizen who left for employment abroad — sub-section (3) disapplies it.
- Using ₹15 lakh of total income including foreign source income; sub-section (14) excludes foreign source income from that test.
- Assuming a low day count guarantees non-residence. Sub-section (7) can deem residence at any day count.
- Treating deemed residence as ordinary residence — sub-section (13)(c) makes such a person not ordinarily resident.
- For companies, relying on the place of incorporation alone and ignoring place of effective management.
This is an explanatory guide, not tax advice, and it does not reproduce the section in full. Read the bare text of the section before you rely on it, and check for later amendments, the Income-tax Rules made under the new Act, and CBDT circulars and notifications.