Private ruling: Residency
Date of advice: 30 October 2023
Published: 11 December 2023
Ruling period: Year ending 30 June 2024
Date scheme commenced: 1 July 2023

Ruling: Q1: Are you a resident of Australia for taxation purposes? | A1: No.

Relevant facts and circumstances: You were born in Country Z. You are a citizen of Country Z and Australia. You were a tax resident of Australia up until you left Australia and became a Country Z resident for tax purposes. You do not own any property in Australia. You and your family have been living and working in Country Y for the past few years. Your employer provides your accommodation in Country Y. Your spouse and child returned to Australia a few months ago. You returned to Australia for a visit in the following month. You went back to Country Y a few weeks later and your family remained in Australia. Your family are staying with your in-laws in Australia. You have planned a holiday in Australia over Christmas. You remain based in Country Y. Your spouse and child intend on living in Australia until your return to Australia. You will return to Australia in several months. You and your family will not rent or purchase a home in Australia before you return to Australia. You and your spouse are not eligible to contribute to the PSS or the CSS Commonwealth super funds.

Relevant legislative provisions: Income Tax Assessment Act 1997 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 tests • 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 tests: 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 not a resident of Australia as follows. Taking into account your individual circumstances, we have concluded that you are not a resident of Australia according to ordinary concepts. We also consider that your domicile is in Australia, and the Commissioner is satisfied that your permanent place of abode is outside Australia. We considered the following factors in forming our conclusion: • You and your family have been living and working in Country Y for the past few years. • Your employer provides your accommodation in Country Y. • You intend on working and living in Country Y until you return to Australia • Your spouse and child intend on living in Australia until your return to Australia. • You will return to Australia in several months • You will not purchase or rent any property in Australia prior to your return to Australia. • You will not exceed 183 days in Australia during the relevant period. You do not fulfil the requirements of the Commonwealth Superannuation test and are therefore not a resident under this test. You will not be a resident of Australia for taxation purposes during the relevant period.