Private ruling: Foreign sourced income
Date of advice: 13 December 2019
Published: February 2020
Ruling period: Year ending 30 June 2019 | Year ending 30 June 2020
Date scheme commenced: 1 July 2018

Ruling: Q1: 1. Are the wages and salary income earned while working in another country for an Australian company foreign sourced? 2. Are you a resident of Australia for income tax purposes while you were working overseas? | A1: 1. Yes - Even though the company who employs you is a resident of Australia, because the work was done in another country, it is classed as foreign inc ome in Australia as per ITAA 1997 section 6(5) . Further information on foreign sourced income can be found by searching 'QC 22115' on ato.gov.au 2. No - Given regard to your circumstances as a whole and a consideration of the residency tests, the Commissioner considers that you are not a resident of Australia for income tax purposes. Further information on residency can be found by searching 'QC 33232' on ato.gov.au

Relevant facts and circumstances: You are a citizen of Australia. You were sent to work in another country by your employer for a three year secondment period with the possibility of being extended. You departed Australia in 20XX with your spouse and two children. You arrived in the other country on a tourist visa. You applied for and were granted an employer sponsored residency card. The residency card means you are treated as a resident for tax purposes while employed in the country. Your family home was rented out and your family possessions were shipped overseas to your new address. When the company you work for was sold, you were required to return to Australia. You returned to Australia in 20XX.

Relevant legislative provisions: Income Tax Assessment Act 1997 Subsection 995-1(1) | Income Tax Assessment Act 1936 Subsection 6(1) | Income Tax Assessment Act 1997 Subsection 6-5(3) | Income Tax Assessment Act 1997 Subsection 6-10