Private ruling: Residency
Date of advice: 22 September 2023
Published: 30 October 2023
Ruling period: Year ended 30 June 20XX
Date scheme commenced: 1 July 20XX

Ruling: Q1: Are you a resident of Australia for taxation purposes? | A1: Yes.

Relevant facts and circumstances: You were born in Country Z. You are a citizen of both Australia and Country Z. You have lived in Australia for many years. You have children who live in Australia. You went to Country Z and were granted permission to leave Australia by the Australian Government due to Covid. You went to Country Z to care for your parents. You do not intend on living in Country Z on a permanent basis. You intend on returning to Australia once you are able to. You returned to Australia for a number of weeks to spend time with your child and to pack up your home to sell it. You sold your home in Australia in the following month. You have placed the proceeds from the sale of the property in your Australian bank account. Your child is using some of the household items and you are storing the rest of your belongings in a friend's garage. You live with your parents in Country Z. You are working in Country Z. You own a second hand car in Country Z and have a bank account in Country Z. You have no Australian income sources. Your job in Australia is not being kept for you. You have not removed your name from the Electoral Roll. You have not notified your bank that you are overseas. You have not had your name removed from Medicare or your health insurance. When completing the Australian Immigration Outgoing passenger card, you advised you were travelling overseas for family reasons. Your sibling has gone to Country Z to also care for your parents. You are not eligible to contribute to the PSS or the CSS super funds.

Relevant legislative provisions: Income Tax Assessment Act 1936 subsection 6(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 Taxation Ruling TR 2023/1 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 relevant period you are a resident of Australia as follows. Taking into account your individual circumstances, we have concluded that you are a resident of Australia according to ordinary concepts. We also consider that your domicile is in Australia. Although you were born in Country Z and your domicile of origin is Country Z, you immigrated to Australia and are an Australian citizen. It is considered that you abandoned your domicile of origin in Country Z and acquired a domicile of choice in Australia. Further, the Commissioner is not satisfied that your permanent place of abode is outside Australia because it is considered that you have not definitely abandoned, in a permanent way, living in Australia. We considered the following factors in forming our conclusion: • You have gone to Country Z to care for your parents. • You do not intend on being in Country Z on a permanent basis. • Your intention is to return to Australia. • Your children are in Australia. • Although you have sold your home, you have cut little, if any, other ties to Australia. You were not in Australia for mor than 183 days in the relevant income year. You do not fulfil the requirements of the Commonwealth Superannuation test and are therefore not a resident under this test. You are a resident of Australia for taxation purposes for the relevant income year.