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Edited version of private ruling

Authorisation Number: 1011567576635

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Ruling

Subject: Residency

Are you a resident of Australia for income tax purposes for the income year ending 30 June 2011?

Yes.

This ruling applies for the following period

Year ending 2011

The scheme commenced on

1 July 2010

Relevant facts

You were born in Country A.

You are a citizen of Country A.

You are single and independent person.

You came to Australia on a temporary visa which is valid for a period of several months.

You have been under contract with an organisation in Australia to attend an internship (an employment opportunity as an exchange trainee).

Your internship was pre-arranged with the organisation and you are paid for your internship.

Your internship is for a period of several months. You stated you are not sure if there is any likelihood of any extension of this internship.

You were not engaged in any employment or internship training in Country A before you came to Australia.

Your only asset in Australia is a bank account and your pay from your internship is deposited into that bank account.

You are sharing and leased an apartment for the duration of your internship in Australia. You stated you have full intentions to enjoy your apartment in Australia.

You did not return to Country A since first arriving in Australia.

You do not have any family in Australia, but friends.

You are member of two clubs in Australia.

You act as an advisor and exchange participant of a club.

You use your organisations gym and basketball courts.

You lived with your parents before coming to Australia.

Your parents are in Country A and sibling is in Country B and they did not accompany you to Australia.

You intend to leave Australia after the completion of your internship for Country A and stay in Country A for a period of several months before finding a job or a Masters Degree elsewhere in the world as you are interested in becoming an international Manager.

You intend to rent an apartment or live with your parents if an apartment is not readily available or affordable.

You have some personal effects in Country A.

You do not own any assets in Country A.

You are a member of a club and facilitate cultural exchange and monitor the quality of the experience gained by both incoming and outgoing exchange participants.

You are also an ambassador of the local chapter to the organisation in Australia.

You did/do not pay taxes anywhere else except in Australia.

Relevant legislative provisions

Income Tax Assessment Act 1936 Subsection 6(1)

Income Tax Assessment Act 1997 Section 995-1(1)

Reasons for decision

An Australian resident is defined in subsection 995-1(1) of the ITAA 1997 to be 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. These tests are:

The primary test for deciding the residency status of an individual is whether the individual resides in Australia according to the ordinary meaning of the word resides. If the primary test is satisfied the remaining three tests do not need to be considered as residency for Australian tax purposes has been established.

Taxation Ruling TR 98/17 considers the residency status of individuals entering Australia and states that the period of physical presence or length of time in Australia is not, by itself, decisive when determining whether an individual resides here. However, an individuals behaviour over the time spent in Australia may reflect a degree of continuity, routine or habit that is consistent with residing here.

In your case, it is considered that you are an Australian resident for income tax purposes for the following reasons:

Based on the information you have provided, it is considered that you are an Australian resident for taxation purposes from the date of your arrival in Australia as your behaviour reflects a degree of continuity, routine or habit that is consistent with residing here.

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