Private ruling: Residency of Australia for taxation purposes
Date of advice: 4 September 2025
Published: 3 November 2025
Ruling period: Year ended 30 June 2025 | Year ending 30 June 2026
Date scheme commenced: 1 July 2024

Ruling: Q1: Are you a resident of Australia for taxation purposes? | A1: Yes.

Relevant facts and circumstances: You were born in Country Z. You are a citizen of Country Z. You are currently awaiting the outcome of your Australian citizenship application. You are a permanent resident of Australia. You have been living and working in Australia for a number of years. You departed Australia a number of months ago and temporarily relocated to Country Z. At the time of your departure, you were employed full-time by your previous employer, who continued to make superannuation contributions, withhold PAYG income tax, and cover your Medicare levy obligations until your redundancy. It was not your intention to leave Australia permanently and stay in Country Z permanently. You gave up your rental property in Australia when you went to Country Z and placed your belongings in a storage facility. You were not a resident of Country Z for taxation purposes. You signed a residential lease in Country Z, which was terminated early and you returned to Australia. You went to Country Z with your Australian partner as they were studying in Country Z. For several months, you performed freelance work for a foreign company. This income was: • Paid into your Australian bank account • Not declared or taxed in Country Z When you returned to Australia you registered your business activity under your ABN, resumed your freelance work. You have a super fund bank account and shares etc in 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) | Income Tax Assessment Act 1997 section 995-1

Reasons for decision: Summary: 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', as applied to an individual, are defined in subsection 6(1) of the ITAA 1936. The definition offers four tests to ascertain whether each individual taxpayer is a resident of Australia for income tax purposes. These tests are: • The resides test (also referred to as the ordinary concepts test) • The domicile test • The 183-day test, and • The Commonwealth superannuation fund test. The resides test is the primary test for deciding the residency status of an individual. This test considers whether an individual resides in Australia according to the ordinary meaning of the word 'resides'. 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 (the domicile test, 183-day test and Commonwealth superannuation fund test). Our interpretation of the law in respect of residency is set out in Taxation Ruling TR 2023/1 Income tax: residency tests for individuals . We have considered the statutory tests listed above in relation to your situation as follows: | Detailed Reasoning - The resides test: The ordinary meaning of the word 'reside' has been expressed as 'to dwell permanently or for a considerable time, to have one's settled or usual abode, to live, in or at a particular place': See Commissioner of Taxation v Miller (1946) 73 CLR 93 at 99 per Latham CJ, citing Viscount Cave LC in Levene v Inland Revenue Commissioners [1928] AC 217 at 222, citing the Oxford English Dictionary. Likewise, the Macquarie Dictionary defines 'reside' as 'to dwell permanently or for a considerable time; have one's abode for a time'. The Commissioner considers the following factors in relation to whether a taxpayer is a resident under the 'resides' test: • 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. It is important to note that no one single factor is decisive, and the weight given to each factor depends on each individual's circumstances. Because the resides test is about whether an individual resides in Australia, the factors focus on the individual's connection to Australia. Having a connection with another country, or being a resident of another country, does not diminish any connection to Australia. The ordinary meaning of reside does not require an individual to have a principle or usual place of residence in Australia. | Detailed Reasoning - Application to your situation: You will be a resident of Australia under the resides test for the relevant period based on the following: • You went to Country Z with your Australian partner. • Your partner was studying in Country Z. • It was not your intention to remain on a permanent basis in Country Z. • You returned to Australia and commenced working under your ABN. You were a resident of Australia for taxation purposes as you did not break your continuity of association with Australia while in Country Z. | Detailed Reasoning - Domicile test: Under the domicile test, you are a resident of Australia if your domicile is in Australia unless the Commissioner is satisfied that your permanent place of abode is outside Australia. | Detailed Reasoning - Domicile: Whether your domicile is in Australia is determined by the Domicile Act 1982 and the common law rules on domicile. Your domicile is your domicile of origin (usually the domicile of your father at the time of your birth) unless you have a domicile of dependence or have acquired a domicile of choice elsewhere. To acquire a domicile of choice of a particular country you must be lawfully present there and hold the positive intention to make that country your home indefinitely. Your domicile continues until you acquire a different domicile. Whether your domicile has changed depends on an objective consideration of all relevant facts. | Detailed Reasoning - Application to your situation: You are a citizen of Country Z. Your domicile of origin is Country Z. You are a permanent resident of Australia. You have applied for citizenship in Australia. Your domicile of choice is therefore Australia. | Detailed Reasoning - Permanent place of abode: If you have an Australian domicile, you are an Australian resident unless the Commissioner is satisfied that your permanent place of abode is outside Australia. This is a question of fact to be determined in light of all the facts and circumstances of each case. 'Permanent' does not mean everlasting or forever, but it is to be distinguished from temporary or transitory. The phrase 'permanent place of abode' calls for a consideration of the physical surroundings in which you live, extending to a town or country. It does not extend to more than one country, or a region of the world. The Full Federal Court in Harding v Commissioner of Taxation [2019] FCAFC 29 held at paragraphs 36 and 40 that key considerations in determining whether a taxpayer has their permanent place of abode outside Australia are: • whether the taxpayer has definitely abandoned, in a permanent way, living in Australia • whether the taxpayer is living in a town, city, region or country in a permanent way. The Commissioner considers the following factors relevant to whether a taxpayer's permanent place of abode is outside Australia: • the intended and actual length of the taxpayer's stay in the overseas country • whether the taxpayer intended to stay in the overseas country only temporarily and then to move on to another country or to return to Australia at some definite point in time • whether the taxpayer has established a home (in the sense of dwelling place; a house or other shelter that is the fixed residence of a person, a family, or a household), outside Australia • whether any residence or place of abode exists in Australia or has been abandoned because of the overseas absence • the duration and continuity of the taxpayer's presence in the overseas country • the durability of association that the person has with a particular place in Australia, i.e. maintaining assets in Australia, informing government departments such as the Department of Social Security that he or she is leaving permanently and that family allowance payments should be stopped, place of education of the taxpayer's children, family ties and so on. As with the factors under the resides test, no one single factor is decisive, and the weight given to each factor depends on the individual circumstances. | Detailed Reasoning - Application to your situation: The Commissioner is not satisfied that you had a permanent place of abode outside Australia for the following reasons: • You went to Country Z for a temporary period. • You did not intend on moving to Country Z on a permanent basis. • You leased a property with your Australian spouse for several months. • Your Australian spouse was in Country Z for study purposes. • You returned to Australia after your short stay in Country Z. • You have an active Australian bank account, stored belongings in Australia and you registered for an ABN upon your return. You are a resident under this test. | Detailed Reasoning - 183-day test: Where a person is present in Australia for 183 days or more during the year of income the person will be a resident, unless the Commissioner is satisfied that both: • the person's usual place of abode is outside Australia, and • the person does not intend to take up residence in Australia. | Detailed Reasoning - Application to your situation: You were not in Australia for 183 days in the relevant income year. You did however intend on returning to Australia to live and work. | Detailed Reasoning - 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 situation: You are not a resident under this test. | Detailed Reasoning - Conclusion: You were a resident of Australia for the relevant income years as you meet the resides test and the domicile permanent place of abode tests.