Private ruling: Residency
Date of advice: 6 September 2022
Published: November 2022
Ruling period: Year ended 30 June 20XX | Year ending 30 June 20XX
Date scheme commenced: 1 July 20XX

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

Relevant facts and circumstances: You were born in Country Z. You are a citizen of Country Z. You are not a permanent resident of any other country. You do not intend on being in Australia on a permanent basis. You have previously lived in Australia. You arrived in Australia to work in a remote area for 14 months. You will return to Country Z in a number of months. You have taken leave from your employment in Country Z to work in Australia. Your spouse and children accompanied you to Australia. You are renting accommodation in Australia for the period you are working in Australia. Your spouse is working in Australia for the period you are here. You have rented out your family home in Country Z while you are working in Australia. You will return to this home to live in a number of months. You have not made any trips back to Country Z since arriving in Australia and you do not intend on making any trips back to Country Z prior to your return to Country Z in a few months. You and your family brought clothing with you to Australia. Neither you nor your spouse are eligible to contribute to the PSS or the CSS Commonwealth Super funds.

Relevant legislative provisions: Income Tax Assessment Act 1936 subsection 6(1)

Reasons for decision: Summary: For tax purposes, whether you are a resident of Australia is defined by subsection 6(1) of the Income Tax Assessment Act 1936 (ITAA 1936). The definition has four tests to determine your residency for income tax purposes. These tests are: • the resides test • the domicile test • the 183 day test, and • the Commonwealth superannuation fund test. It is sufficient for you to be a resident under one of these tests to be a resident for tax purposes. Our interpretation of the law in respect of residency is set out in: Taxation Ruling IT 2650 Income tax: residency - permanent place of abode Taxation Ruling TR 98/17 Income tax: residency status of individuals entering Australia. | Detailed Reasoning - The resides test: The resides test is the primary test of tax residency for an individual. If you reside in Australia according to the ordinary meaning of the word resides, you are considered an Australian resident for tax purposes. Some of the factors that can be used to determine whether you reside in Australia include: • period of physical presence in Australia • intention or purpose of presence • behaviour while in Australia • family and business/employment ties • maintenance and location of assets • social and living arrangements. No single factor is decisive, and the weight given to each factor depends on your specific circumstances. Where an individual does not reside in Australia according to ordinary concepts, they will still be an Australian resident if they meet the conditions of one of the other tests. | Detailed Reasoning - The domicile test: Under the domicile test, if your domicile is in Australia, you are a resident of Australia unless the Commissioner is satisfied that your permanent place of abode is outside Australia. Whether your domicile is Australia is determined by the Domicile Act 1982 and the common law rules on domicile. For example, you may have a domicile by origin (where you were born) or by choice (where you have changed your home with the intent of making it permanent). Whether your permanent place of abode is outside Australia is a question of fact to be determined in light of all the facts and circumstances of each case. Key considerations in determining whether you have your permanent place of abode outside Australia are: • whether you have definitely abandoned, in a permanent way, living in Australia • length of overseas stay • nature of accommodation, and • durability of association | Detailed Reasoning - The 183-day test: Under the 183 day test, if you are present in Australia for 183 days or more during the income year, you will be a resident, unless the Commissioner is satisfied that both: • your usual place of abode is outside Australia, and • you do not intend to take up residence in Australia. The question of usual place of abode is a question of fact and generally means the abode customarily or commonly used by you when are physically in a country. | Detailed Reasoning - The Commonwealth superannuation test: An individual is a resident of Australia if they are either a member of the superannuation scheme established by deed under the Superannuation Act 1990 or an eligible employee for the purposes of the Superannuation Act 1976 , or they are the spouse, or the child under 16, of such a person. | Detailed Reasoning - Application to your circumstances: We have considered each of the statutory tests listed above in relation to your particular facts and circumstances. We conclude that, for the relevant period you are not a resident of Australia as follows. Taking into account your individual circumstances, we have concluded that you are not a resident of Australia according to ordinary concepts. We also consider that your domicile is not in Australia and the Commissioner is satisfied that your permanent place of abode is outside Australia. We considered the following factors in forming our conclusion: • You do not intend on being in Australia on a permanent basis. • You are in Australia for a number of months to work. • You are renting a property in Australia for this period for you and your family to live in. • You have rented out your family home in Country Z and you will return to this home in a number of months. • You and your family only brought clothes to Australia with you. You have been in Australia for more than 183 days but the Commissioner is satisfied that you do not intend on taking up residence in Australia and that your usual place of abode is in Country Z. You do not fulfil the requirements of the Commonwealth Superannuation test and are therefore not a resident under this test. | Detailed Reasoning - Application to your circumstances: We have considered each of the statutory tests listed above in relation to your particular facts and circumstances. We conclude that, for the relevant period you are not a resident of Australia for taxation purposes.