RNOR Golden Window
Get 2-3 years of completely tax-free foreign income in India
What is This Hack?
Time your return to India to get RNOR status for 2-3 years, during which foreign income and capital gains remain completely tax-free in India
How It Works
RNOR (Resident but Not Ordinarily Resident) is a special transitional tax status when you return to India after living abroad. To qualify, you must: (1) be a resident of India (stay 182+ days), AND (2) have been NRI for at least 2 out of the last 10 years OR have stayed in India for less than 730 days in the last 7 years. During RNOR status (typically 2-3 years), you are taxed like a resident on Indian income, but foreign income that is earned and received abroad remains completely tax-free in India. This includes foreign salary, business income, rental income, and capital gains on foreign assets. It's a golden window to accumulate wealth tax-free while enjoying the benefits of Indian residency.
Step-by-Step Implementation
Calculate Eligibility Timeline
Use our NRI Residential Status Calculator to determine when you can return to India and qualify for RNOR. You need 2+ years as NRI in the last 10 years or less than 730 days in India in the last 7 years.
Plan Your Return Date
Time your return to maximize RNOR years. Typically, if you've been abroad 3-4 years, you can get 2-3 years of RNOR status. The longer you stayed abroad (within limits), the longer your RNOR window.
Maintain Foreign Employment/Income
Continue earning from foreign sources (remote work for foreign companies, freelancing, rental income abroad, investments abroad). Ensure income is earned and received in foreign bank accounts.
Document Everything
Maintain proof that foreign income is earned and received abroad: employment contracts, invoices, bank statements showing foreign deposits, rental agreements, investment statements.
File ITR Declaring RNOR Status
File ITR-2 or ITR-3 declaring yourself as RNOR. Report all Indian income and disclose foreign income (even though it's not taxable) in the schedule for foreign assets and income.
Track RNOR Expiry
RNOR status automatically expires when you no longer meet the criteria. Plan your finances accordingly - you'll become ROR (Resident Ordinary Resident) and all worldwide income will be taxable.
Real Example: Tech Professional Returning from USA
Situation
Arjun worked in Silicon Valley for 5 years (2018-2023). He returns to India in April 2024 but continues working remotely for his US employer earning $120,000 annually (₹1 crore). He also has US stocks generating $20,000 capital gains annually.
Without This Hack
As ROR (Resident Ordinary Resident): Total US income ₹1.16 crore taxable in India. Tax liability: ₹34 lakhs per year. Foreign Tax Credit may apply but paperwork is complex.
With This Hack
As RNOR (2024-2026): US salary and capital gains received in US bank account are completely tax-free in India. Only Indian income (if any) is taxable. Tax savings: ₹34 lakhs × 2-3 years = ₹68-102 lakhs total saved.
💰 ₹68-102 lakhs saved over 2-3 years
Common Pitfalls to Avoid
- Foreign income must be "earned AND received" abroad - don't remit to India immediately
- RNOR status can be lost if you stay abroad too long (becomes NRI again)
- Complex calculation - use calculator to verify status each year
- Foreign assets still need to be disclosed in ITR (Schedule FA)
- Some banks/employers may not understand RNOR status - educate them
- Once RNOR expires, all future foreign income becomes taxable
Prerequisites & Requirements
- Must be NRI for 2 of last 10 years OR stayed <730 days in last 7 years
- Must be resident in India (182+ days) when claiming RNOR
- Foreign income must be earned and received in foreign bank accounts
- Must file ITR declaring RNOR status
- Documentary proof of foreign employment/income
- Track days in India vs abroad meticulously
Key Benefits
- Potential savings: ₹10-50 lakhs
- Implementation time: 6 months planning
- Legal status: fully legal
- Risk level: low
Related Topics
Related Calculators
Related Articles
The Complete NRI Residential Status Calculator: 10 Scenarios That Determine Your Tax Fate
Interactive scenarios covering frequent fliers, work-from-India arrangements, and day-counting worksheets
NRI DTAA Double Tax Relief: Complete Guide with Country-wise Rates
How to claim double taxation avoidance agreement benefits with TRC and Form 10F