Private ruling: Residency status
Published: August 2012
Date scheme commenced: 1 January 2012

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


Relevant legislative provisions: Income Tax Assessment Act 1936 Section 6(1) | Income Tax Assessment Act 1997 Subsection 6-5(2) Reasons for decision | Subsection 6-5(2) of the Income Tax Assessment Act 1997 (ITAA 1997) provides that the assessable income of a resident taxpayer includes ordinary income derived directly or indirectly from all sources during the income year. | The terms resident and resident of Australia, in regard to an individual, are defined in subsection 6(1) of the Income Tax Assessment Act 1936 (ITAA 1936). The definition provides four tests to ascertain whether a taxpayer is a resident of Australia for income tax purposes. These tests are: · The resides test | · The domicile test | · The 183 day test | · The superannuation test. | The primary test for deciding the residency status of an individual is whether the individual resides in Australia according to the ordinary meaning of the word resides. If the primary test is satisfied the remaining three tests do not need to be considered as residency for Australian tax purposes has been established. | The ordinary meaning of the word 'reside', according to the Macquarie Dictionary , 2001, rev. 3 rd edition, The Macquarie Library Pty Ltd, NSW, is 'to dwell permanently or for a considerable time; having one's abode for a time', and according to the Compact Edition of the Oxford English Dictionary (1987), 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'. | Taxation Ruling TR 98/17 Income tax: residency status of individuals entering Australia, discusses the Commissioner's interpretation on the residency status of individuals entering Australia. | Taxation Ruling TR 98/17 provides that generally the Commissioner regards six months or 183 days as a considerable time when deciding an individual's behaviour is consistent with residing here. The Commissioner is also of the view that the period of physical presence or length of time in Australia is not, by itself, decisive when determining whether an individual resides here. However, an individual's behaviour over the time spent in Australia may reflect a degree of continuity, routine or habit that is consistent with residing here. | The following factors assist in identifying the quality and character of an individual's behaviour: | · intention or purpose of presence; | · family and business/employment ties; | · maintenance and location of assets; and | · social and living arrangements. | In your case, you arrived in Australia on a long term visa. You arrived in Australia with the intention of accompanying your spouse who has a long term employment posting in Australia. During your time in Australia you have gained fulltime employment and have created social and sporting ties. You have an Australian bank account and live in long term leased accommodation. | In view of the above, the Commissioner considers that your behaviour in Australia reflects a degree of continuity, routine and habit that is consistent with residing here. Accordingly, you are an Australian resident for income tax purposes under the 'resides' test. | As it has been established that you are resident under the resides test there is no need to consider the remaining 3 tests. | Accordingly, you are a resident of Australia for income tax purposes under subsection 6(1) of the ITAA 1997.


Please check this edited version to be sure that there are no details remaining that you think may allow you to be identified. If you have any concerns about this ruling you wish to discuss, you will find our contact details in the fact sheet. | Relevant facts: You were born in country Z and are a citizen of both country Z and country T. | You hold both a country Z and country T passport. | You have come to Australia for the purpose of accompanying your spouse who has been posted to Australia for employment purposes. | You arrived in Australia on a visa that allows you to stay in Australia for the duration of your spouse's posting. | While in Australia you occupy a fulltime employment position and live in a long term leased apartment. | The assets that you own in Australia consist of a bank account. | The assets that you own overseas consist of a house and bank accounts. | Your home overseas is unoccupied. | You intend to leave Australia for a short period every year to visit family overseas. | Your social and sporting ties in Australia consist of; | · membership of an performance school; | · being an active participant and volunteer in various festivals; and | · being a member of other non-profit organisations based in Australia. | You intend to remain in Australia until the completion of your spouse's posting which will be for a number of years. | Once your spouse's posting in Australia is complete you intend to return to Country T.