Private ruling: Residency of Australia for taxation purposes
Date of advice: 15 February 2019
Published: April 2019
Ruling period: Year ending 30 June 2019
Date scheme commenced: 1 July 2018

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

Relevant facts and circumstances: You are a citizen of Australia and the Country X You became a resident of Australia in mid-late 200X. You own a property in Australia. You do not have any Australian financial investments. From July 201X you have been working in a full time capacity for relevant company. You work on relevant projects in a number of overseas countries. You have a visa for Country Y that allows you to work full time. You lived in Country Y for over 300 days during the 201X financial year. You intend to spend a minimum of 300 days in Country Y during the 201Y financial year. Your employer provides your accommodation in Country Y. Due to the nature of your employment you hold expatriate life insurance. Once you are finished on the current project you intend to look for ongoing employment overseas. You are not a government employee and you are not eligible to contribute to the PSS or the CSS Commonwealth superannuation funds.

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