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

Ruling: Q1: Are you an Australian resident for taxation purposes? | A1: No

Relevant facts and circumstances: You are a citizen of Australia. You had a permanent residency visa for a Place in Country X. You were born in Australia. You were offered a permanent position to work in Country X. You departed Australia on dd/mm/yyyy. Your spouse accompanied you to Country X. You have two independent children who remained in Australia. Prior to your departure, you were living in your primary residence in Australia. You entered the country on a business visa which was converted to a residence permit. The residence visa allowed you to stay permanently in Country X. The purpose of your stay in Country X was employment. You formed your intention to make your home indefinitely outside Australia in 20XX. You sold most of your household effects and stored the rest in storage You intention was to return to Australia after 4 to 5 years. You returned to Australia in 2014 when your employer closed their office and your employment was made redundant. You did not hold a return ticket. Under the terms of the employment, you were repatriated to Australia at the company's cost. Since leaving Australia, you returned on holiday and business on X occasions. During your trips to Australia, you stayed with family and friends. In Country X, you lived in a rental property secured independently with allowance provided by your employer. The rental property was on a 12 month lease with option to renew every year. In Country X, you opened bank accounts. You did not own any asset. In Australia, you owned your place of residence, furniture and had bank accounts. Australia has been your permanent home since birth except when you were employed in Country Y during the relevant years. You rented your property on a 12 month lease that was renewable annually when you moved to Country X. You have social and sporting connections in Australia. You had social and sporting connections in a Place in Country X. You advised the Australian Electoral Office to have your name removed from the electoral. You advised your Australian financial institutions that you are a foreign resident so that non-resident withholding tax could be deducted. You advised the financial planners of the Australian Companies with whom you have investment that you are a foreign resident. You suspended your private health insurance. In the Australian immigration outgoing passenger card, you ticked the box stating you are departing permanently. You and your spouse were not employed by the Commonwealth of Australia.


Reasons for decision: Summary: Generally where you are a resident of Australia for taxation purposes, your assessable income includes income gained from all sources, whether in or out of Australia. However, where you are a foreign resident, your assessable income includes only income derived from an Australian source. The terms 'resident' and 'resident of Australia', in regard to an individual, are defined within the tax provisions and provides four tests to ascertain the residency status. Relevant to your situation are the first two tests which are examined in Taxation Ruling IT 2650 Income Tax: Residency - permanent place of abode outside Australia, a copy of which is available from www.ato.gov.au. Given regard to your circumstances as a whole and a consideration of the relevant residency tests, it is accepted that you are not a resident of Australia for tax purposes.