Short answer: residency is still Section 6, unchanged in number and in substance. What moved is the NRI chapter (115C–115I → 212–218), treaty relief (90 → 159) and withholding on payments to non-residents (195 → 393(2)). Residential status still decides everything else.
Residency first — and it did not change
Section 6 keeps its number in the 2025 Act, and the tests are the ones you know:
- 182 days or more in India during the year, or
- 60 days in the year plus 365 days across the four preceding years
With the two refinements that have caused most of the recent disputes:
- The 120-day rule for visiting NRIs whose Indian income exceeds ₹15 lakh — the 60-day limb tightens to 120 days
- Deemed residency for an individual with Indian income above ₹15 lakh who is not liable to tax in any other country
RNOR — resident but not ordinarily resident — remains the transitional status most returning NRIs pass through, usually for about two years. It is worth planning for, because an RNOR is taxed on Indian-sourced income and on foreign income from a business controlled in India, but not on worldwide income. For someone returning with overseas investments or a foreign brokerage account, that distinction can be worth a great deal, and it turns on day counts.
| Provision | 1961 Act | 2025 Act |
|---|---|---|
| Residence in India | s.6 | s.6 (unchanged) |
| Scope of total income | s.5 | s.5 |
| Income deemed to accrue in India | s.9 | s.9 |
The charging architecture is deliberately untouched. A non-resident is taxed on income sourced in or received in India; deemed accrual — business connection, significant economic presence, royalty and fees for technical services, indirect transfer — continues at Section 9.
What did move
| Provision | 1961 Act | 2025 Act |
|---|---|---|
| DTAA relief / TRC | ss.90, 90A | s.159 |
| Unilateral relief (no treaty) | s.91 | s.160 |
| NRI concessional chapter | ss.115C–115I | ss.212–218 |
| Reinvestment exemption | s.115F | s.215 |
| Non-resident dividends, royalty, FTS | s.115A | s.207 |
| TDS on payments to non-residents | s.195 | s.393(2) |
| Lower / nil deduction certificate | s.197 | s.395 |
| Non-resident presumptive regimes | ss.44B–44BBB | s.61 |
| Royalty / FTS where there is a PE | s.44DA | s.59 |
| Agent of a non-resident | s.163 | s.306 |
| Occasional shipping | s.172 | s.316 |
Treaty relief at Section 159. The mechanics are unchanged — a treaty position requires a Tax Residency Certificate from the other jurisdiction together with the prescribed declaration, and the treaty applies where it is more beneficial than the Act. Where no treaty exists, unilateral relief sits at Section 160.
The NRI chapter at 212–218. Concessional rates on investment income and long-term gains from specified foreign-exchange assets continue, as does the reinvestment exemption now at Section 215.
⚠️ Buying property from an NRI
This is the single most common and most expensive error in NRI-related transactions, and it falls on the buyer, not the seller.
Buying immovable property from a resident uses the ordinary property-purchase withholding route, with its ₹50 lakh threshold and a modest rate on the consideration.
Buying from a non-resident does not. It falls under the non-resident provision — Section 195 of the 1961 Act, now Section 393(2) — and deduction is on the full sale consideration, not on the gain, at the applicable rate, with no threshold at all.
Buyers who apply the resident route to an NRI seller under-deduct substantially and become assessee-in-default, with interest and penalty following. The seller's remedy for the over-withholding relative to actual gain is a lower-deduction certificate under Section 395 (the old Section 197), obtained before completion — not a refund claimed a year later.
From 1 October 2026, a resident individual or HUF buyer no longer needs a TAN for this deduction. That removes a procedural barrier; it does not soften the obligation. See TDS on property sale by an NRI.
Foreign asset disclosure is a separate question
Nothing in the renumbering changes this, and it is worth stating plainly because the two get conflated: disclosure of foreign assets is an obligation independent of whether any tax is due. Non-disclosure carries exposure under the Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015, regardless of the tax position.
For a returning NRI with an overseas account or vested shares acquired abroad, that exposure often long predates the return to India. Where earlier years were missed, FAST-DS 2026 is the disclosure window being opened to regularise them — at 60% of value rather than the 120% the Black Money Act charges, or a flat ₹1,00,000 on narrower facts.
And it is not confined to people who are resident today. Section 131(1)(a) of the Finance Act, 2026 defines the eligible assessee in two limbs, the second of which expressly covers a person who is non-resident or not ordinarily resident in the previous year, provided they were resident in India either in the previous year to which the foreign income relates, or in the previous year in which the asset was acquired. Someone who built up a foreign holding while resident and has since moved abroad is squarely within it. The Scheme has not yet commenced, so nothing can be filed for now.
For the mechanics of what goes where, see Schedule FA from your broker statement.
A practical order of work
- Count the days for each year in question and fix residential status — everything follows from this
- Identify the RNOR window if you are returning, and what it shelters
- Establish the treaty position and obtain the TRC where relevant
- Separate India-taxable income from foreign income that is outside the net
- Check withholding obligations on any Indian payer, especially on a property transaction
- Deal with foreign asset disclosure on its own terms, independently of the tax
For the sections beyond the NRI chapter, the old-to-new mapping is the quick reference. For which Act governs a given year, see tax year vs assessment year.
This is a working reference, not the statute. For anything you are filing or relying on, confirm the section text and any treaty article against the Act, the treaty or the department's official 1961-vs-2025 comparison utility.