Moment guide · FY 2026-27

I am returning to India and may be an RNOR

What is the RNOR tax window when I return to India?

You are an RNOR if you were a non-resident in 9 of the 10 preceding years (or in India 729 days or less in the 7 preceding years). During the RNOR window — typically 2 years, up to 3 — foreign income is not taxable in India, NRE/FCNR interest stays tax-free, and Schedule FA is NOT required; that obligation starts only when you become an ordinary resident.

The #1 trap

Filing Schedule FA during the RNOR years when it is not required — or worse, thinking RNOR means no Indian filing at all. RNOR excludes foreign income but Indian income is fully taxable. Also, the RNOR window is usually two to three years, after which you become ROR and global income plus Schedule FA obligations begin.

Ritu, banker returning from London after 12 years

Ritu returns to India in May 2025 after 12 years in London. She was a non-resident in all 10 preceding years, so she qualifies as a Resident but Not Ordinarily Resident (RNOR) under section 6(6). During the RNOR window her income accruing in London — her UK pension drawdowns, interest on her UK savings and dividends on UK stocks — is not taxable in India, because foreign income from foreign sources is excluded for an RNOR. Her NRE account interest of ₹2,40,000 a year remains tax-free during RNOR, and her FCNR deposits continue to earn tax-free interest. Indian income is not shielded: her rental income of ₹6,00,000 from a Delhi flat is fully taxable, and she reports it with the tenant's TDS under section 195. Importantly, Ritu does NOT file Schedule FA during the RNOR years, because the foreign-asset schedule is required only of residents and ordinarily resident (ROR) taxpayers — a mistake many returnees make by copying their ROR-year disclosures. Her RNOR window runs for roughly two years, after which she becomes ROR: from that point her global income is taxable and Schedule FA must list all foreign accounts, property and investments. Ritu also confirms she is not caught by the section 6(1A) deemed-resident rule, which is aimed at Indian citizens in zero-tax countries rather than her UK situation. She keeps her UK bank statements and pension records for the transition year. A quick call with us dials in the final figure. Ritu also verifies that her RNOR status is re-tested every year, because the 9-of-10-years condition counts the ten preceding financial years and her time in India accumulates as she stays longer. If she remains in India, the RNOR window typically lasts two years and ends by the third year, after which she becomes an ordinary resident and her global income is taxed. During RNOR, income accruing in India from foreign assets — such as interest credited to an NRO account from a foreign bank — is taxable, so she distinguishes the source of each receipt. Her UK pension contributions made while in India during RNOR do not qualify for Indian deductions, because the pension is a foreign plan. If she withdraws from her UK pension during RNOR, the withdrawal is foreign-source income and is not taxed in India. A quick call with us dials in the final figure.