Private ruling: Residency for tax purposes
Date of advice: 11 December 2018
Published: April 2019
Ruling period: Period ending the 30 June 2018
Date scheme commenced: 17 November 2017

Ruling: Q1: Am I a resident of Australia for tax purposes? | A1: No. 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 country X for income tax purposes under section 995-1(1) of the ITAA 1997 and subsection 6(1) of the ITAA 1936. | Q2: Am I considered a non-resident from the time I left the country? | A2: Yes.

Relevant facts and circumstances: You and your spouse have always lived in Australia. You have no children/dependents. You own a property in Australia. You and your spouse moved to Country Y. You are employed by an Australian employer. You and your spouse left Australian to travel to Country Y. You entered Australia on a tourist visa. You and your spouse signed a Residential Tenancy Agreement in Country Y. The agreement is for a significant period with an option to extend. You were granted a work permit for Country Y You intend to stay in Country Y for the foreseeable future. You rent out your residence in Australia. You rent a home in Country Y. You have full time employment in Country Y. You cancelled your health insurance in Australia, and obtained private health insurance in Country Y. You have opened bank accounts and obtained a driver’s licence in Country Y. Due work obligations, you returned to Australia for short period. You returned to Country Y and continue to work from Country Y for your Australian employer.

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