Private ruling: Residency for taxation purposes
Date of advice: 19 March 2019
Published: May 2019
Ruling period: Year ended 30 June 2017 | Year ended 30 June 2018
Date scheme commenced: 1 July 2017

Ruling: Q1: Are you a resident of Australia for income 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 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 country X and Country Z national. You do not hold Australian citizenship or permanent residency and you do not intend on obtaining either. You obtained a job in Australia which you commenced in in the 20XX income year. You and your Family arrived in Australia in the 20XX income year. Your family consisted of a spouse and X children. Your spouse is a citizen of Australia. You have a home in Country X which was your main residence up until you moved to Australia and it is now being rented out. You also have a holiday apartment in Country X which is occasionally rented out and is also used by you when you return to Country X. You left your Australian employment in the 20XX income year You obtained employment in Country Y and left Australia permanently in the 20XX income year. You rent accommodation in country Y. You took all your personal belongings to Country Y with you. You pay tax in Country Y on your income. You return to Australia to visit your children. You enter Australia on a visitor’s visa. Your children and spouse do not visit you in Country Y. You do not exceed 183 days in Australia in any of the relevant financial years. Your spouse and children remain in Australia. Your spouse purchased a home in Australia. You do not financially support your spouse. You and your spouse are separated. You are not eligible to contribute to the CSS or the PSS Commonwealth super funds.

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