ATO Interpretative Decision

ATO ID 2002/1064

Income Tax

Assessable Income - a 'member' of a Superannuation scheme
FOI status: may be released
  • This document has changed over time. View its history.

Status of this decision: Decision Current
CAUTION: This is an edited and summarised record of a Tax Office decision. This record is not published as a form of advice. It is being made available for your inspection to meet FOI requirements, because it may be used by an officer in making another decision.

This ATOID provides you with the following level of protection:

If you reasonably apply this decision in good faith to your own circumstances (which are not materially different from those described in the decision), and the decision is later found to be incorrect you will not be liable to pay any penalty or interest. However, you will be required to pay any underpaid tax (or repay any over-claimed credit, grant or benefit), provided the time limits under the law allow it. If you do intend to apply this decision to your own circumstances, you will need to ensure that the relevant provisions referred to in the decision have not been amended or repealed. You may wish to obtain further advice from the Tax Office or from a professional adviser.

Issue

Is a taxpayer who is in receipt of an Australian Government superannuation pension and living overseas, a 'resident' as defined in subsection 6(1) of the Income Tax Assessment Act 1936 (ITAA 1936)?

Decision

No. A taxpayer who is in receipt of an Australian Government superannuation pension and living overseas, is not a resident as defined in subsection 6(1) of the ITAA 1936 as they do not pass the superannuation tests.

Facts

The taxpayer previously lived and worked in Australia. They left Australia to permanently reside in another country. The taxpayer does not intend to return to Australia.

The taxpayer is not a resident of Australia under the 'resides test', 'domicile test' or '183 day test' (refer Taxation Ruling IT 2650 Income tax: Residency - permanent place of abode outside Australia).

The taxpayer is in receipt of a Public Sector Superannuation Scheme (PSS) pension - an Australian Government superannuation pension.

Reasons for Decision

Subsection 6(1) of the ITAA 1936 defines a 'resident' or 'resident of Australia' to be:

(a)
'a person, other than a company, who resides in Australia and includes a person-

(i)
whose domicile is in Australia, unless the Commissioner is satisfied that the person's permanent place of abode is outside Australia;
(ii)
who has actually been in Australia, continuously or intermittently, during more than one-half of the year of income, unless the Commissioner is satisfied that the person's usual place of abode is outside Australia and that the person does not intend to take up residence in Australia; or
(iii)
who is:

(A)
a member of the superannuation scheme established by deed under the Superannuation Act 1990; or
(B)
an eligible employee for the purposes of the Superannuation Act 1976; or ...'

Accordingly, a taxpayer will be considered to be a resident of Australia if they are a 'member' of the superannuation scheme established by deed under the Superannuation Act 1990. The PSS was a superannuation scheme established by deed under the Superannuation Act 1990.

Part 3 of the Superannuation Act 1990 specifies who is a member of the PSS. Generally this would include a permanent or temporary employee of the Australian Public Service (APS). As the taxpayer is no longer employed by the APS they do not fall within the category of persons specified in Part 3 of the Superannuation Act 1990. Therefore the taxpayer is not a 'member' of the superannuation scheme for the purposes of the definition of 'resident' under sub-subparagraph (a)(iii)(A) of the definition of 'resident' in subsection 6(1) of the ITAA 1936.

Sub-subparagraph (a)(iii)(B) of the definition of 'resident in subsection 6(1) of the ITAA 1936 has no application to the taxpayer as they neither are or were a member of the Commonwealth Superannuation Scheme (the superannuation scheme established by the the Superannuation Act 1976).

Therefore the taxpayer, although they are in receipt of a PSS pension, is not a resident of Australia under the definition of resident in subsection 6(1) of the ITAA 1936.

Amendment History

Date of amendment Part Comment
20 June 2014 Issue updated to reflect current terminology
Decision updated to reflect current terminology
Facts updated for clarity
Reasons for decision amended to update legislative references and to improve clarity
Legislative References Updated

Date of decision:  1 November 2002

Year of income:  Year ended 30 June 2002

Legislative References:
Income Tax Assessment Act 1936
   subsection 6(1)

Superannuation Act 1990
   Part 3

Related Public Rulings (including Determinations)
Taxation Ruling IT 2650

Related ATO Interpretative Decisions
ATO ID 2002/1065

Keywords
Non resident individuals
Resident/residency
Superannuation pension income
Annuities & superannuation pensions

Business Line:  Small Business/Individual Taxpayers

Date of publication:  28 November 2002

ISSN: 1445-2782

history
  Date: Version:
  1 November 2002 Original statement
You are here 20 June 2014 Original statement