Private ruling: Residency and leaving Australia
Date of advice: 15 February 2016
Published: April 2016
Ruling period: Year ended 30 June 20XX | Year ended 30 June 20XX
Date scheme commenced: 1 July 20XX

Ruling: Questions and answers: | Are you a resident of Australia for income tax purposes? | No.

Relevant facts and circumstances: You are a citizen of Australia. You elected to be a resident of Country A for the relevant tax years. You accepted a position in Country A in 20XX The position was a one year position, but you understood and expected that you would be able to extend the contract pursuant to standard practice. You regarded your relocation to Country A as being for an indefinite term. You, your spouse and children left Australia for Country A in 20XX. Your travel to Country A was facilitated via a one-way air travel ticket. You took out a 12 month lease on a house. You had an active involvement in certain activities with your country A. Significant monies were transferred from Australia to Country A to fund the costs of establishing yourselves in Country A. You took all your holidays within Country A. You regarded your time in Country A as an "immersive life experience". For all intents and purposes you considered yourselves to have established a home and a way of life in Country A. You rented your house out in Australia on an indefinite basis. It was rented in a fully furnished state. You have maintained a mortgage and bank accounts in Australia. You returned to Australia permanently in 20XX due to your employment prospects changing significantly. During your time in Country A, your employer introduced a new policy that would require you to undertake further study to continue your work in Country A beyond one year. Rather than undertake further study, you decided to return to Australia. Absent this change in policy you would have continued to reside in Country A. You did not contribute to the PSS or CSS Commonwealth schemes.


Reasons for decision: Summary: 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 from your date of departure from Australia to the date you permanently returned.