Private ruling: Residency
Date of advice: 13 April 2023
Published: 29 May 2023
Ruling period: The year ending 30 June 20XX
Date scheme commenced: 1 July 20XX

Ruling: Q1: Am I a resident of Australia for tax purposes for the income year ending 30 June 20XX? | A1: Yes.

Relevant facts and circumstances: You were born in Country A. You are a citizen of Australia, Country B and Country C. You acquired your citizenship of the Country B at birth. You became a citizen of Australia through skilled migration and became a citizen after a period of permanent residency. You became a citizen of Country C through ancestry. In the 3 years prior to the ruling period, you were in Australia. You made one 4-week, overseas trip to City A, Country D and Country B. During the ruling period, you were based in Country E from July 20XX to XX April 20XX. Your spouse accompanied you in your travel from Australia to Country E. You can enter Country E because you have a Country C passport. This allows you to stay permanently in Country E. You do not intend to apply for citizenship or permanent residency in Country E. Your spouse has applied for residency in Country E. This visa allows your spouse to stay in Country E for up to 5 years, not permanently. This visa is still being processed, pending a decision. The purpose of your travel to Country E during the ruling period was to spend one year living with your spouse, closer to your elderly parent and family who live in Country A. During your time in Country E, you stayed in a rental apartment on a X-month lease. You have notified the landlord that you will not renew the contract. You vacated the apartment on DD/MM/YYYY. From XX July 20XX to XX August 20XX, you were in Country F and Country B. You travelled to Country G, Country F and Country H between XX August 20XX and XX September 20XX. You were in Country F from XX September 20XX to XX October 20XX. You were in Country B on the following dates: • X November 20XX to X November 20XX • XX December 20XX to XX December 20XX • XX February 20XX to XX February 20XX • XX March 20XX to X April 20XX You were in Country I from X April 20XX to X April 20XX. You will be in Country B from X April 20XX to XX April 20XX. Your spouse has a one-way ticket booked from City B to City C on XX April 20XX. You have a one-way ticket booked from City B to City C on XX April 20XX. You will remain in Australia permanently from this date onwards. In the years going forward, you will remain in Australia with potential holidays, of up to 3 weeks in duration, to Continent A and Country B to visit family every 3 years. You own the home in City C jointly with your spouse (your home). When completing incoming and outgoing passenger cards, you state that your residency status is Australia and use your home address. You were living in your home prior to your departure from Australia. Your home was first rented out on XX March 20XX. Your home has been rented to unrelated parties under commercial lease arrangements and normal commercial rates. The rental of your home is being managed by a real estate agent. While your home is rented out, you have stored your personal and household effects in a secure storage unit. You remain responsible for the mortgage over your home whilst overseas. You continue to have mail sent to your home address. You continue using your home as your address for banking and investments, the Australian Electoral Commission, mobile phone, rates and Australian driver licence. You have maintained your Australian driver licence whilst overseas. You informed the Australian Electoral Commission that you were departing Australia. You suspended your private medical insurance when you departed Australia. You hold a 50% share in a transactional bank account in Country E. In Australia, in addition to your home, you have the following assets: • 50% share in joint bank accounts, with a value of approximately $XX. • 50% share of a Managed Fund investment, with a value of approximately $XX. • Superannuation, with a value of approximately $XX. You, nor your spouse, have been employed during your time overseas. You may be required to declare as a Country E tax resident from X January to XX December 20XX as you have spent more than 183 days in the region of Country E. You have family in Australia including your in-laws (parents and sibling) and paternal relatives. You have developed a strong social network of friends while living in City C for numerous years. You have also developed a strong professional network within your employment industry during your career in Australia. You are still in contact with your last employer in Australia regarding work opportunities for when you return in May 20XX. You do not maintain any professional, social or sporting connections overseas. You, nor your spouse, are members of the Public Sector Superannuation Scheme (PSS) which was established under the Superannuation Act 1990 or the Commonwealth Superannuation Scheme (CSS) which was established under the Superannuation Act 1976 . You are not engaged in a course of study. You have not advised your Australian financial institutions, including any Australian companies with whom you have investments, that you are a foreign resident.

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

Reasons for decision: Summary: For tax purposes, whether you are a resident of Australia is defined by subsection 6(1) of the Income Tax Assessment Act 1936 (ITAA 1936). The definition has four tests to determine your residency for income tax purposes. These tests are: • the resides test • the domicile test • the 183 day test, and • the Commonwealth superannuation fund test. It is sufficient for you to be a resident under one of these tests to be a resident for tax purposes. Our interpretation of the law in respect of residency is set out in Draft Taxation Ruling TR 2022/D2 Income tax: residency tests for individuals . | Detailed Reasoning - The resides test: The resides test is the primary test of tax residency for an individual. If you reside in Australia according to the ordinary meaning of the word resides, you are considered an Australian resident for tax purposes. Some of the factors that can be used to determine whether you reside in Australia include: • period of physical presence in Australia • intention or purpose of presence • behaviour while in Australia • family and business/employment ties • maintenance and location of assets • social and living arrangements. No single factor is decisive, and the weight given to each factor depends on your specific circumstances. Where an individual does not reside in Australia according to ordinary concepts, they will still be an Australian resident if they meet the conditions of one of the other tests. | Detailed Reasoning - The domicile test: Under the domicile test, if your domicile is in Australia, you are a resident of Australia unless the Commissioner is satisfied that your permanent place of abode is outside Australia. Whether your domicile is Australia is determined by the Domicile Act 1982 and the common law rules on domicile. For example, you may have a domicile by origin (where you were born) or by choice (where you have changed your home with the intent of making it permanent). Whether your permanent place of abode is outside Australia is a question of fact to be determined in light of all the facts and circumstances of each case. Key considerations in determining whether you have your permanent place of abode outside Australia are: • whether you have definitely abandoned, in a permanent way, living in Australia • length of overseas stay • nature of accommodation, and • durability of association. | Detailed Reasoning - The 183-day test: Under the 183 day test, if you are present in Australia for 183 days or more during the income year, you will be a resident, unless the Commissioner is satisfied that both: • your usual place of abode is outside Australia, and • you do not intend to take up residence in Australia. The question of usual place of abode is a question of fact and generally means the abode customarily or commonly used by you when are physically in a country. | Detailed Reasoning - The Commonwealth superannuation test: An individual is a resident of Australia if they are either a member of the superannuation scheme established by deed under the Superannuation Act 1990 or an eligible employee for the purposes of the Superannuation Act 1976, or they are the spouse, or the child under 16, of such a person. | Detailed Reasoning - Application to your circumstances:: We have considered each of the statutory tests listed above in relation to your particular facts and circumstances. We conclude that, for the period from 1 July 2022 to 30 June 2023, you are a resident of Australia for tax purposes as follows. Taking into account your individual circumstances, we have concluded that you are a resident of Australia according to ordinary concepts. We considered the following factors in forming our conclusion: • Physical presence - you were physically present in Australia for less than X months during the income year ended 30 June 20XX. In surrounding income years, you resided in Australia on a permanent basis. • Intention or purpose of presence - You are a citizen of Australia through skilled migration. On incoming and outgoing passenger cards, you say your address is your home in Australia. You live in and are settled in Australia. Your overall residency intentions are to reside in Australia permanently. You may be a resident of Country E for tax purposes from X January to XX December 20XX as you were present in Country E for more than 183 days during this income year. The purpose of your absence from Australia during the ruling period was to visit your family overseas. • Behaviour while in Australia - You live permanently in Australia in your home. You have family, social and professional connections in Australia. • Family ties - You have family in Australia including your in-laws (parents and sibling) and paternal relatives. Your parent and other family members reside overseas. • Business and employment ties - You have a strong professional network in Australia, within your employment industry, due to your long career in Australia. You have remained in contact with your last employer during your time overseas, regarding work opportunities when you return to Australia. You do not maintain any professional, social or sporting connections overseas. • Maintenance and location of assets - Your personal and household effects are in storage in Australia during your time overseas. In Australia, your assets include your home, joint bank accounts, a managed fund investment and superannuation. Overseas, in Country E, you only have a joint transactional account. • Social and living arrangements - You had a X-month lease of a rental apartment in Country E. You vacated this apartment on X April 20XX and informed your landlord that you would not renew this lease. You have used Country E as your home base overseas while travelling to nearby countries. In Australia, you own a home that you have rented out during your time overseas. You have developed a strong network of friends from your XX years of living in City C. You do not have any professional, sporting or social connections overseas. You maintained your Australian driver licence while overseas. You suspended your private medical insurance when departing Australia, however did not inform your Australian financial institutions that you are a foreign resident for tax purposes. We consider that your domicile is in Australia, and you have not established a permanent place of abode outside Australia. We considered the following factors in forming this conclusion: • You intend to return to Australia permanently on XX April 20XX. • Your overseas stay is for a fixed duration of less than one year. • You have maintained your associations to Australia whilst overseas. You were not in Australia for 183 days or more during the income year ended 30 June 20XX. Therefore, you do not satisfy the 183-day test. You do not fulfil the requirements of the Commonwealth Superannuation test and are therefore not a resident under this test. | Detailed Reasoning - Conclusion: You satisfy the resides and domicile tests of residency and so are a resident of Australia for income tax purposes for the year ending 30 June 20XX.