Private ruling: Dividend payment
Date of advice: 17 June 2019
Published: September 2019
Ruling period: Year ending 30 June 2019 | Year ending 30 June 2020 | Year ending 30 June 2021 | Year ending 30 June 2022
Date scheme commenced: 1 July 2018

Ruling: Q1: Are you assessable on the dividends paid from a non-resident company? | A1: No. The dividend is paid to a temporary resident for taxation purposes by a non-resident company out of profits from its overseas operations, and the dividend is sourced internationally. | Q2: Are you assessable on the dividends paid from the company where the company is a resident of Australia? | A2: Not applicable

Relevant facts and circumstances: You were born overseas and remain a citizen this country. In 20XX you moved to Australia and you are a temporary resident for Australian taxation purposes. You retain an ownership interest in an international incorporated company and you are the sole director. You own 99% of the shares on issue and the company is a non-resident for taxation purposes. The company does not conduct its business or trading affairs in Australia. It is your intention to sell the business. Upon its disposal the company will make a capital gain. The company will then pay out the profits to the shareholders including you, as dividends. The company will then cease to trade.

Relevant legislative provisions: Income Tax Assessment Act 1936 section 6(1)(b) | Income Tax Assessment Act 1936 section 44 | Income Tax Assessment Act 1997 section 6-5 | Income Tax Assessment Act 1997 section 6-10 | Income Tax Assessment Act 1997 section 6-15 | Income Tax Assessment Act 1997 section 768-910 | Income Tax Assessment Act 1997 section 995-1