Private ruling: Residency
Date of advice: 3 August 2020
Published: September 2020
Ruling period: Year ended 30 June 2020 >Year ending 30 June 2021 >Year ending 30 June 2022 >Year ending 30 June 2023
Date scheme commenced: 10 March 2020

Ruling: Q1: Are you a resident of Australia for taxation purposes? | A1: No

Relevant facts and circumstances: You were born in Australia. You are a citizen of Australia. You departed for country A to take up a employment position. Your position is a permanent position and has no end date. Your spouse and child moved to country A at a later stage. You shipped all your belongings and have established a home in country A. You and your family are renting in country A. Your spouse works part time, your spouse has a fixed term contract which may get renewed, or your spouse will look for other work. Your child attends day-care in country A. You have opened bank accounts in country A. You have obtained your country A driving licence. You have purchased a motor vehicle in country A. Your family house in Australia has been rented out and it is managed by an Australian real estate agent. You also own two other investment properties in Australia. You maintain bank accounts in Australia. You maintain a share portfolio in Australia. You have advised your private health insurance in Australia to have your policy suspended. You do not have any social or sporting connections with Australia. You will inform Medicare that you have departed Australia. You have never been a Commonwealth Government of Australia employee for superannuation purposes.

Relevant legislative provisions: Income Tax Assessment Act 1936 subsection 6(1) | Income Tax Assessment Act 1997 section 995-1(1)

Reasons for decision: Summary: Section 995-1 of the Income Tax Assessment Act 1997 (ITAA 1997) defines an Australian resident for taxation purposes as a person who is a resident of Australia for the purposes of the Income Tax Assessment Act 1936 (ITAA 1936). The terms 'resident' and 'resident of Australia', regarding an individual, are defined in subsection 6(1) of the ITAA 1936. The definition provides four tests to ascertain whether a taxpayer is a resident of Australia for income tax purposes. The tests are: The first two tests are examined in detail in Taxation Ruling IT 2650 Income tax: residency - permanent place of abode outside Australia. Thelatter two tests are relatively self-explanatory as they require the individual to either be physical present in Australia for a period greater than 183 days or be eligible to contribute to the PSS or CSS superannuation schemes. If any one of these tests is met, an individual will be a resident of Australia for taxation purposes. Based on the facts you have provided; we can conclude that you will not satisfy any of the tests of residency. Accordingly, you are not a resident of Australia for income tax purposes from you and your family final departure date.

the domicile (and permanent place of abode) test