Private ruling: Residency
Date of advice: 3 March 2017
Published: August 2017
Ruling period: Year ended 30 June 20VV | Year ended 30 June 20WW | Year ended 30 June 20XX | Year ended 30 June 20YY | Year ending 30 June 20ZZ
Date scheme commenced: 1 July 20UU

Ruling: Q1: Are you a resident of Australia for income tax purposes? | A1: No. | Q2: Are you required to declare your foreign sourced income in your Australian tax return? | A2: No.

Relevant facts and circumstances: You were born in Australia. You are a citizen of Australia. You and your family went to Country Y to live and work in the 20VV income year. You have a work visa for Country Y which is renewed every 12 months. You have only returned to Australia twice since leaving for short visits. You stayed with family and in hotels when you were visiting Australia. You rent your family home out in Australia. You rent accommodation in Country Y. You and your spouse are not eligible to contribute to the PSS or the CSS commonwealth super 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 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. You are therefore not required to declare your foreign sourced income in your Australian tax return.