Private ruling: Residency
Published: August 2013
Ruling period: Year ended 30 June 2014 | Year ended 30 June 2013 | Year ended 30 June 2012
Date scheme commenced: 1 July 2011

Ruling: Question and answers | Are you a resident of Australia for tax purposes from 1 July xxxx until you 30 June xxyy? | No.


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

Reasons for decision: Detailed Reasoning - Residency: 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'. You were residing in country A for approximately 1 year as evidenced by: · living in your spouse's parent's home · your spouse and child accompanying you · your child attending the local school · you attending school to learn the local language · your intention to move to country A for several years; and · you resigning from your job in Australia before you left. Therefore, you were not considered to be residing in Australia during your time in country A. You were residing in country B for a period of time as evidenced by: Living in unchanged accommodation provided by your employer, but chosen mutually between yourself and your employer. The accommodation was partly furnished by you, and fully serviced by you and your spouse. You were employed on an initial several months contract which was extended by more months; and Your spouse and child moved from country A to live with you approximately 1 month after you moved there. Therefore, you were/are not considered to be residing in Australia during your time in country B. Your employer has advised you that you will return to Country A for at least another year. You will return to live with family. Your spouse and child have already returned to Country A from Country B and your child is enrolled and attending the local school Therefore, you were/are not considered to be residing in Australia during this period. | Detailed Reasoning - The domicile test: If a person is considered to have their domicile in Australia they will be considered an Australian resident unless the Commissioner is satisfied they have a permanent place of abode outside of Australia. A person's domicile is generally their country of birth. This is known as a person's 'domicile of origin'. A person's domicile of origin will not usually change, but can in some circumstances. For example, a person can acquire a domicile in another country by choice. In order to show that a new domicile of choice in a country outside Australia has been adopted, the person must be able to prove an intention to make his or her home indefinitely in that country. Australia is your country of origin. However, you obtained a Temporary Residency Visa to move with your family to country A for several years so are considered to have acquired a domicile of choice in the country A for that period. In your case the Commissioner is satisfied that you have a domicile outside Australia so you are not a resident under this test for the period 1 July xxxx to 30 June xxyy. | Detailed Reasoning - The 183-day test: Under the183 day test you are considered a resident of Australia if you are present in Australia for a total period of more than half of the year of income, that is 183 days, unless the Commissioner is satisfied that your usual place of abode is outside Australia and you do not intend to take up residence in Australia. As you were/will be present in Australia for less than 183 days in the xxxx-aa, xxaa-bb and xxbb-yy income years, you are not a resident for tax purposes under this test. | Detailed Reasoning - The superannuation test: An individual is still considered to be a resident if that person is eligible to contribute to the Public Service Superannuation Scheme (PSS) or the Commonwealth Superannuation Scheme (CSS), or that person is the spouse or child under 16 of such a person. To be eligible to contribute you must be or have been a Commonwealth Government employee You will not be treated as a resident under this test as you and your spouse have not worked for the Commonwealth Government of Australia and so cannot be a member of the CSS or PSS. Further, you are over 16 years old. | Detailed Reasoning - Conclusion: As you have not passed any of the tests of residency, you were not/will not be a resident of Australia for tax purposes for the period 1 July xxxx to 30 June xxyy.

Relevant facts: Your country of origin is Australia. | For several years it has been you and your spouse's intention to move to country A to live near family. | You departed Australia to move to country A on a several year Temporary Residency Visa. | You have maintained all bank accounts and investments in Australia. | You have leased out your family home in Australia while you are away. | You resigned from your job in Australia prior to leaving for country A. | Your spouse and child have accompanied you to the country A. | You did not work while you were in country A, and you lived off of your savings from Australia. | You lived in your spouse's parent's home while in Country A, and your child attended the local school there. | You attended school to learn the local language while you were there. | You commenced employment with a foreign company in country B. | Your spouse and child accompanied you shortly after. | In country B you are living in accommodation provided by your employer. | Your spouse and child lived with you in the accommodation provided by your employer. | The accommodation is a semi furnished rental apartment. You have purchased some items. | The apartment is fully serviced and cleaned by you and your spouse. | Your accommodation was chosen in mutual agreement with your employer to ensure it meets the requirements of you and your family. | You have remained in the same accommodation in country B. | You are working on a contract that will last approximately 1 year and possibly a little longer. | Your employer has advised you that you will return to country A at the end of your current contract. You will return to live with family. | You intend returning to Australia to live in the future unless unforseen circumstances require you to return earlier. | You have returned to Australia on a couple of occasions for a few weeks each time since leaving to attend to issues relating to your rental property, to visit your extended family and for holidays. | You and your spouse have never been Commonwealth of Australia employees. | You are over 16 years of age.