Private ruling: Residency
Date of advice: 6 September 2018
Published: October 2018
Ruling period: 1 July 2016 – 30 June 2017
Date scheme commenced: 1 July 2016

Ruling: Q1: Are you considered to be an Australian resident for taxation purposes under Section 6-5 of the Income Tax Assessment Act 1997 (ITAA 1997)? | A1: Yes You have satisfied the residency domicile test. As you satisfied one of the four residency tests outlined in subsection 6(1) of the ITAA 1936, you are considered a resident of Australia for tax purposes for year ended 30 June 2017. As a resident of Australia for tax purposes, income you derive from Australia and overseas countries during the income year is assessable. You are considered to be an Australian resident for taxation purposes under Section 6-5 of the Income Tax Assessment Act 1997 (ITAA 1997).

Relevant facts and circumstances: In Early 2016 you left Australia to return to Country X. Late 2016 you bought a house in Country X. Your intention is to renovate it while in Country X and sell it when you return to Australia Early 2018 you returned to Australia to catch up with friends and to make a new will encompassing your Country X property. Early 2018 you left Australia to return to Country X. You have always intended to return to Australia You were born in Australia and are an Australian citizen and receive an Australian Centrelink age pension. You own a residential property in Australia that has always been used for rental purposes: ● this property has not held a mortgage since late 2007 ● you have never used this address on any documents ● it is managed by real estate agents ● you intend to return to Australia to retire to it You have continued to pay the Medicare levy and lodge Australian tax returns stating you are a resident for taxation purposes. You stay at friends’ homes when visiting Australia and your belongings are stored with a friend in Australia. You hold X bank accounts with several banks in Australia and have one bond account in Australia. You hold a very small investment in a wine company. If they sell wine on your behalf they deposit it into your bond account You have no dependent children and have been separated from your spouse since mid-19XX. You and your spouse have never been employed by the Commonwealth of Australia and are not a member of the Public Sector Superannuation Scheme (PSS) or Commonwealth Superannuation Scheme (CSS). You are also a citizen of Country Y and hold their passport and receive their pension. You have held a Country Y drivers licence since 19XX. You have been granted residency in Country X as you own property there. Your Country X residency commenced from late 2016, this date coincides with the purchase of your Country X property You stayed at friends’ homes when visiting Country X and other European countries and on some occasions you did rent but usually friend of friends with no written agreement in Country X. You have held a Country Y bank account since 19XX and have another Country Y bank account which your Country Y pension is paid into. You paid tax in the Country Y, hence small pension and never filed a return.

Relevant legislative provisions: Income Tax Assessment Act 1936 , Section 6(1) | Income Tax Assessment Act 1936 , Section 6-5