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Edited version of private advice
Authorisation Number: 1012641181106
Ruling
Subject: Residency
Question
Are you a resident of Australia for taxation purposes?
Answer
Yes
This ruling applies for the following period
Year ending 30 June 2015
Year ending 30 June 2016
The scheme commences on
1 July 2014
Relevant facts and circumstances
You are a citizen of Australia.
Your spouse has accepted a position in an overseas country for X years.
You are entitled to reside in the overseas during the contract period, but you are not entitled to a working visa unless you can obtain sponsorship from a company in the overseas country.
You intend to engage in work with Australian employers while living overseas.
Relevant legislative provisions
Section 995-1(1) of the Income Tax Assessment Act 1997
Subsection 6(1) of the Income Tax Assessment Act 1936
Section 6-5 of the Income Tax Assessment Act 1997
Reasons for decision
An Australian resident for tax purposes is defined in subsection 995-1(1) of the Income Tax Assessment Act 1997 (ITAA 1997) 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, which provides four tests to ascertain whether a taxpayer is an Australian resident for income tax purposes. These tests are:
1. The resides test;
2. The domicile test;
3. The 183 day test; and
4. The superannuation test.
Your residency
Under the domicile test, a person is a resident of Australia if their domicile is in Australia unless the Commissioner is satisfied they have a permanent place of abode outside of Australia.
Your domicile of origin is in Australia. You will not acquire a new domicile of choice by moving to the overseas country for the purpose of your spouse completing a work contract.
In regards to permanent place of abode:
• You are travelling to the overseas country as you spouse has accepted a X year employment contract. Once this is complete, you have an intention of returning to Australia with your spouse.
• You will be renting accommodation in the overseas country.
• Your main residence and the majority of your assets are in Australia.
• You have strong family connections in Australia.
Based on the reasons discussed above, the Commissioner is not satisfied that you will have a permanent place of abode while in the overseas country. Therefore, you will remain a resident of Australia under this test for the period of time you are overseas. This applies to you as an individual entity and is so whether you are unemployed, an employee, or a sole trader.
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