Private ruling: Residency for taxation purposes
Date of advice: 17 December 2018
Published: April 2019
Ruling period: Year ended 30 June 2019
Date scheme commenced: 1 July 2018

Ruling: Q1: Are you a resident of Australia for income tax purposes? | A1: No Section 995-1 of the Income tax Assessment Act 1997 (ITAA 1997) defines an Australian resident for tax purposes as a person who is a resident of Australia for the purposes of the Income Tax Assessment Act 1936 (ITAA 1936). The terms ‘resident’ and ‘resident of Australia’, in regard to an individual, are defined in subsection 6(1) of the ITAA 1936. The definition provides four tests to ascertain whether a taxpayer is a resident of Australia for income tax purposes. The tests are: ● the resides test, ● the domicile test, ● the 183 day test, and ● the superannuation test. If any one of these tests is met, an individual will be a resident of Australia for taxation purposes. Based on the facts you have provided, we can conclude that you will not satisfy any of the tests of residency. Accordingly you are not a resident of Australia for income tax purposes under section 995-1(1) of the ITAA 1997 and subsection 6(1) of the ITAA 1936.

Relevant facts and circumstances: You have left Australia. You do not intend to return to Australia. You have spent approximately one year living overseas. You formed the intention to leave Australia permanently late 20XX. You are a director of an Australian company. You are not involved in the operation of the company and are not required to be physically present in Australia to fulfil your duties. You will not be receiving any remuneration for being a director of the company. You do not have any investments or property in Australia. You previously operated a partnership which ceased trading late 20XX. You have entered into an agreement for long term accommodation in Country Y. You are closing down Australian bank accounts. You do not have any other assets in Australia. You do not have any dependants living in Australia. You are not eligible to contribute to the relevant Commonwealth superannuation funds.

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