Private ruling: Residency for taxation purposes
Date of advice: 15 July 2015
Published: July 2015
Ruling period: 1 July 20XX to 30 June 20XX.
Date scheme commenced: 1 July 20XX.

Ruling: Question and answer: | Are you a resident of Australia for taxation purposes? | Yes.

Relevant facts and circumstances: You were born in Australia and you are an Australian citizen. You lived and worked in another country for several years. You returned to Australia and set up a permanent home in Australia. You intend to spend at least six months of the year in Australia, as well as periods of time in the country you lived and worked in.

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

Reasons for decision: Detailed Reasoning - Residency for taxation purposes: 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 (and permanent place of abode) 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. The resides test is the primary test for determining the residency status of an individual for taxation purposes. If residency is established under the resides test, the remaining three tests do not need to be considered. However, if residency is not established under the resides test, an individual will still be a resident of Australia for taxation purposes if they meet the conditions of one of the other three tests. | Detailed Reasoning - The resides test: The resides test considers whether an individual is residing in Australia according to the ordinary meaning of the word 'reside'. As the word 'reside' is not defined in Australian taxation law, it takes it's ordinary meaning for the purposes of subsection 6(1) of the ITAA 1936. In Dempsey and Commissioner of Taxation [2014] AATA 335 (29 May 2014) the Administrative Appeals Tribunal noted that the settled position of the courts (at ultimate appellant level) as to the meaning of the word resides in the ITAA 1936 is that the word: bears its ordinary English meaning, which is "to dwell permanently or for a considerable time, to have one's settled or usual abode, to live in or at a particular place". The Commissioner accepts that your 'settled or usual abode' will be in Australia between 1 July 20XX and 30 June 20XX Accordingly, you will be a resident of Australia under the resides test for that period. Because you will be a resident under the resides test it is not necessary for us to consider any of the other tests of residency. | Detailed Reasoning - Conclusion: Based on the facts you have provided you will be a resident of Australia for taxation purposes for the relevant years.