Private ruling: Taxing right of income under double tax agreements
Date of advice: 17 September 2025
Published: 17 November 2025
Ruling period: Year ended 30 June 20XX | Year ending 30 June 20XX
Date scheme commenced: DD MM YYYY

Ruling: Q1: Is the income you derive under a casual contract of employment with University A exempt from tax in Australia under the double tax agreement with Country A? | A1: Yes. | Q2: Is the income you derive under a fixed term contract of employment with University A exempt from tax in Australia under the double tax agreement with Country A? | A2: Yes. | Q3: Is the income you derive under a casual contract of employment with University B exempt from tax in Australia under the double tax agreement with Country A? | A3: Yes.

Relevant facts and circumstances: You were a tax resident of Country A immediately before your visit to Australia. On DD MM YYYY, you arrived in Australia on Visa A. Visa A allowed you to stay in Australia for 24 months from the date of arrival. On DD MM YYYY, you applied for Visa B, a permanent visa available to individuals in Australia who meet specific criteria under Australian law. On DD MM YYYY, you were granted Visa C, which permitted you to remain lawfully in Australia while your application for Visa B was being processed. As a result, your previous Visa A was subsequently varied. You intend to make Australia your permanent place of residence once Visa B is granted. You obtained a private ruling confirming your exemption from Australian income tax under the Double Tax Agreement between Australia and Country A in relation to a fixed-term employment contract with an Australian university. This exemption applied to the period from DD MM YYYY to DD MM YYYY, covering the financial years ending 30 June 20XX and 30 June 20XX. In connection with this ruling, you requested that the exemption be applied to each of your employment contracts for the period from DD MM YYYY to DD MM YYYY, which corresponds with the conclusion of the two-year exemption period available under the Double Tax Agreement between Australia and Country A. Contract 1 On DD MM YYYY, you began working under a casual employment contract (Contract 1) with University A as a xx Officer on Project A. This contract did not include a specified end date. Under the terms of your contract, you report directly to your supervisor. Project A is a xx-year longitudinal study and aims to address the chronic shortage of xx in Australia. Your research supports the public interest by aiming to improve xx outcomes. You contributed to Project A by identifying effective xx practices in State A xx, providing technical support for a longitudinal survey on xx quality, conducting quantitative research, including literature reviews, data analysis, and academic writing, and collaborating with stakeholders to enhance the impact of the research. Contract 2 On DD MM YYYY, you entered into a fixed-term employment contract (Contract 2) with University A as a xx Officer, continuing your involvement in Project A. The contract had an end date of DD MM YYYY. Under the terms of your contract, you report directly to a supervisor. Contract 2 continues your involvement in the same project as contract 1, with identical responsibilities carried over under a fixed-term role as xx Officer. Contract 3 On DD MM YYYY you began working under a casual employment contract (Contract 3) with University B to work as a xx Assistant on Project B. The contract did not specify an end date. Project B was commissioned and funded by a government department to advance the public interest by improving xx outcomes. The project focuses on building xx capability, embedding inclusive and evidence-based xx practices, and fostering collaborative xx cultures that support xx reform. Through these initiatives, Project B aims to create a more equitable and high-performing xx system that benefits all xx. Under the terms of your contract, you report directly to a supervisor. Your key responsibilities for this research project mirror those outlined in Contracts 1 and 2. The income earned under your employment contract will be subject to taxation in Country A.

Relevant legislative provisions: Income Tax Assessment Act 1997 subsection 6-5(3) | Income Tax Assessment Act 1997 subsection 6-10(5) | Income Tax Assessment Act 1997 subsection 6-20(2) | International Tax Agreements Act 1953 section 4 | International Tax Agreements Act 1953 section 5

Reasons for decision: Summary: Question 1 to 3 Australian tax law generally requires foreign residents to pay tax on income sourced from Australia, including employment income. However, exemptions may apply under international agreements. The Double Tax Agreement between Australia and Country A exempts Country A residents who visit Australia for up to two years to teach or conduct public-interest research at recognised institutions, provided the income is taxed in Country A. In your case, as a researcher from Country A conducting public-interest research at an Australian university, you qualify for this exemption. You have now reached the maximum two-year period allowed under the Agreement, and therefore the remuneration within the two-year allowable period remains exempt from Australian tax and is not included in your assessable income. However, this decision is based on the specific facts of your situation and should not be automatically applied to other taxpayers. Each case must be assessed individually, taking into account the relevant factors. | Detailed Reasoning - Detailed reasoning: Subsection 6-5(3) of the Income Tax Assessment Act 1997 (ITAA 1997) provides that the assessable income of a foreign resident taxpayer includes ordinary income that is sourced directly or indirectly from all Australian sources during the income year. Subsection 6-10(5) of the ITAA 1997 provides that assessable income of a foreign resident taxpayer includes statutory income from all Australian sources. Employment income is ordinary income for the purposes of subsection 6-5(3) of the ITAA 1997. Subsection 6-20(2) of the ITAA 1997 provides that ordinary income is exempt to the extent that 'this Act' excludes it from being assessable income. 'This Act' is defined to include the Income Tax Assessment Act 1936 (ITAA 1936). In determining your liability to pay tax in Australia it is necessary to consider not only the domestic income tax laws but also any applicable double tax agreement. | Detailed Reasoning - Country A's Double Tax Agreement with Australia: Section 4 of the International Tax Agreements Act 1953 (Agreements Act) incorporates that Act with the ITAA 1936 and the ITAA 1997 so that all three Acts are read as one. The Agreements Act overrides both the ITAA 1936 and ITAA 1997 where there are inconsistent provisions (except in some limited situations). Section 5 of the Agreements Act states that, subject to the provisions of the Agreements Act, any provision in an Agreement listed in section 5 has the force of law. Country A is listed in section 5 of the Agreements Act. The Agreement operates to avoid the double taxation of income received by residents of Australia and Country A. Article 19 of the Agreement states: • A xx, xx or researcher who visits one of the Contracting States, for a period not exceeding two years, for the purpose of xx or engaging in research at a university, college, xx or other recognised educational institution in that Contracting State, and who immediately before that visit was a resident of the other Contracting State, shall, for a period not exceeding two years from the date of first arrival l in that first-mentioned State for that purpose, be exempt from tax in that first-mentioned State on the remuneration for such teaching or research, to the extent that the remuneration is subject to tax in the other Contracting State. • No exemption shall be granted under paragraph 1 with respect to any remuneration for research if such research is undertaken not in the public interest but primarily for the private benefit of a specific person or persons. As you are a researcher visiting Australia for a period not exceeding two years for the purpose of research at a university, and who was a resident of Country A immediately before your visit, you are exempt from taxation in Australia in respect to the remuneration for that research, subject to that income being taxed in Country A. The exemption is allowable as your research relates to a matter which is in the public interest. Consequently, the remuneration from the university is not included in your assessable income in Australia.