Private ruling: Residency for Tax Purposes
Date of advice: 24 May 2018
Published: July 2018
Ruling period: Period ending 30 June 20XX | Period ending 30 June 20XX | Period ending 30 June 20XX
Date scheme commenced: 1 July 20XX

Ruling: Q1: Are you a non-resident for Australian tax purposes? | A1: Yes

Relevant facts and circumstances: You were born in Australia. You left Australia to work in Country A for 1 year as a post-doctoral scientist. You have accepted a 2 year extension to your contract of employment. Your work visa has been extended to the end of your contract. You rented an apartment and a vehicle. You are an avid badminton player and play 3 times a week and participate in tournaments. You have Private Medical insurance subsidised by your employer. You have returned to Australia for family matters only. You have a local bank account in country A. Your employment income is subject to taxes in that country You do not own a residence in Australia. All of your personal items have been with you in country A. Your intention is to further your career and not return to Australia in the near term.

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 6-5 of the Income Tax Assessment Act 1997 (ITAA 1997) provides that where you are a resident of Australia for taxation purposes, your assessable income includes income gained from all sources, whether in or out of Australia. However, where you are a foreign resident, your assessable income includes only income derived from an Australian source. 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. On the information provided you do not meet any of these tests and are therefore considered a non-resident for tax purposes.