Private ruling: International pensions
Date of advice: 8 February 2018
Published: June 2018
Ruling period: Year ended 30 June 20XX | Year ended 30 June 20XX
Date scheme commenced: 1 July 20XX

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

Relevant facts and circumstances: You were born in Australia and you are a citizen of Australia. You have lived and worked outside Australia for the majority of the past 20 years. You have been living and working in Country Y since the 20XX income year. You have a home in Country Y. Your partner lives with you in Country Y. Your home in Australia was initially rented out and has now been sold. You have a bank account and a rental property in Australia. You have been working in Australia during the 20XX and 20XX income years. During the 20XX income year you were in Australia for a total of 181 days. In the 20XX income year you were in Australia for a total of 50 days. During your visits to Australia for work purposes you stayed in hotels. You came to Australia on a frequent basis for short periods of time. You have no intentions on living permanently in Australia in the near future. You do not have any dependent children living in Australia. Neither you nor your partner are eligible to contribute to the PSS or the CSS Commonwealth superannuation funds.

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

Reasons for decision: Summary: Section 6-5 of the Income Tax Assessment Act 1997 (ITAA 1997) provides that where you are a resident of Australia for taxation purposes, your assessable income includes income gained from all sources, whether in or out of Australia. However, where you are a foreign resident, your assessable income includes only income derived from an Australian source. Section 995-1 of the Income tax Assessment Act 1997 (ITAA 1997) defines an Australian resident for tax 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’, in regard to 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 resides test, ● the domicile test, ● the 183 day test, and ● the superannuation test. 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 under section 995-1(1) of the ITAA 1997 and subsection 6(1) of the ITAA 1936.

ATO view documents: Taxation Ruling TR 98/17 – Income tax: residency status of individuals entering Australia | Taxation Ruling IT 2650 – Income tax: residency – permanent place of abode outside Australia | Taxation Ruling IT 2650A (Addendum) – Income tax: residency – permanent place of abode outside Australia | Other references (Non ATO view – example court cases, etc): Macquarie Dictionary, [Multimedia], version 5.0.0, 1/10/01 | Dempsey and Commissioner of Taxation [2014] AATA 335 (29 May 2014) | Federal Commissioner of Taxation v Miller [1946] HCA 23; (1946) 73 CLR 93. | Levene v Inland Revenue Commissioners [1928] UKHL 1; [1928] AC 217. | Applegate v Federal Commissioner of Taxation [1978] 1 NSWLR 126 | Does Part IVA or any other anti-avoidance provision apply to this ruling?: The application of Part IVA of the ITAA 1936 has not been considered as this topic is in the SBIT low risk PART IVA list as specified in ORCLA.