How is the residential status of a HUF and a company determined in India?

Residential Status of HUF

A HUF (Hindu Undevided Family) like an individual may be resident and non resident again a resident HUF may be ordinary resident and non ordinary resident.

When a HUF is said to be resident

A HUF is said to be resident in India in any previous year. if its control and management of its affairs is situated wholly or partially in India during the relevant previous year. The control and management of affairs means controlling and directing power or decision making power for important affairs is situated in india.

When HUF said to be resident and ordinary resident in india

Resident HUF will be called as ordinary resident of India, if the karta of HUF satisfies both the following conditions.

a. The karta must be resident in india at least 2 out of 10 previous years immediately preceding the relevant previous years.

b. He must be in India for at least 730 days during 7 previous years immediately preceding the relevant previous year.

When a resident HUF is called an ordinary resident if the karta of HUF does not satisfy both the conditions for ordinary resident.

When a HUF is said to be non resident

A HUF is said to be non resident in India as during the previous year, the control and management of affairs of HUF is situated wholly outside india.

Residential Status of a Company

A company may be:

1.Resident in india

2.Non resident in india

When a company is called resident in india

A company will be called resident in india if any previous year if

a.It is an Indian company.

b.During the relevant previous year the control and management of its affairs is situated wholly in india.

When a company is called non resident in india

A company will be called non resident in india in any previous year if.

a.it is not an indian and,

b.The control and management of its affairs is situated wholly outside india.

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