Private ruling: Residency for tax purposes
Published: April 2012
Ruling period: Year ended 30 June 2009 Year ended 30 June 2010 | Year ended 30 June 2011 | Year ending 30 June 2012
Date scheme commenced: 1 July 2008

Ruling: Question and answer | Were you a resident of Australia for taxation purposes for the duration of your time in Australia? | Yes.

Relevant facts and circumstances: You were born in Australia and you have dual citizenship with Australia and another country. You moved overseas many years ago. You moved back to Australia with your spouse and family a number of years ago. You commenced work in Australia. You purchased a home in Australia shortly after moving back to Australia... You realised after a period of time that you would need to go back overseas to continue your work. You split your time between Australia and the overseas country. You purchased a house in the overseas country recently. You and your spouse do not intend to return to live in Australia in the near future. Neither you nor your spouse have been or are currently Commonwealth government employees.

Relevant legislative provisions: Income Tax Assessment Act 1936 Section 6-1

Reasons for decision: Summary: The terms resident and resident of Australia, in regard to an individual, are explained in subsection 6(1) of the Income Tax Assessment Act 1936 (ITAA 1936). The legislation lists four tests which will help us ascertain whether you were a resident of Australia for income tax purposes for the duration of your time in Australia. These tests are: (i) residence according to ordinary concepts; (ii) The domicile/permanent place of abode test; (iii) The 183 days/usual place of abode test; and (iv) The Commonwealth superannuation test. The primary test for deciding your residency status is whether you lived in Australia according to the ordinary meaning of the word resides. However, where you do not reside in Australia according to ordinary concepts, you may still be considered to be a resident of Australia for tax purposes if you satisfy one of the other three tests. The resides test The ordinary meaning of the word 'reside', according to the Macquarie Dictionary , 2001, rev. 3 rd edition, The Macquarie Library Pty Ltd, NSW, is 'to dwell permanently or for a considerable time; having one's abode for a time', and according to the Compact Edition of the Oxford English Dictionary (1987), is 'to dwell permanently, or for a considerable time, to have one's settled or usual abode, to live in or at a particular place'. Another reference is Taxation Ruling TR 98/17 Income tax: residency status of individuals entering Australia which discusses the Commissioner's interpretation on the residency status of individuals entering Australia. These are available for viewing in total on our website www.ato.gov.au. Generally the Commissioner regards six months or 183 days as a considerable time when deciding an individual's behaviour is consistent with residing here. The Commissioner is also of the view that the period of physical presence or length of time in Australia is not, by itself, decisive when determining whether an individual resides here. However, an individual's behaviour over the time spent in Australia may reflect a degree of continuity, routine or habit that is consistent with residing here. The following factors assist in identifying the quality and character of an individual's behaviour: · intention or purpose of presence; · family and business/employment ties; · maintenance and location of assets; and · Social and living arrangements. You returned with your family from an overseas country to live in Australia on a permanent basis a number of years ago. You and your spouse purchased a home in Australia shortly after returning. You felt that Australia was a child friendly place to raise your children. You and your family were in Australia for a number of years. Despite the fact that you moved between Australia and other countries to continue your work you did not establish a new home in any other country and returned to your home in Australia on a regular basis to visit your family. You returned to Australia on a regular basis until the purchase of a home overseas and you then returned overseas with an intention not to live in Australia again and to only visit for holidays. You were a resident of Australia for taxation purposes from duration of your stay in Australia as you were residing in Australia according to ordinary concepts. As you were a resident of Australia for taxation purposes under the resides test it is not necessary to look at the domicile, 183 day and superannuation tests. Your residency status: You were a resident of Australia for taxation purposes for the time you were in Australia.

Please check this edited version to be sure that there are no details remaining that you think may allow you to be identified. If you have any concerns about this ruling you wish to discuss, you will find our contact details in the fact sheet.