Disclaimer
This edited version has been archived due to the length of time since original publication. It should not be regarded as indicative of the ATO's current views. The law may have changed since original publication, and views in the edited version may also be affected by subsequent precedents and new approaches to the application of the law.

You cannot rely on this record in your tax affairs. It is not binding and provides you with no protection (including from any underpaid tax, penalty or interest). In addition, this record is not an authority for the purposes of establishing a reasonably arguable position for you to apply to your own circumstances. For more information on the status of edited versions of private advice and reasons we publish them, see PS LA 2008/4.

Edited version of your written advice

Authorisation Number: 1013044948213

Date of advice: 1 July 2016

Ruling

Subject: Residency - departing Australia

Question 1

Are you a non-resident of Australia for income tax purposes from your date of departure in March 20XX?

Answer

Yes.

This ruling applies for the following periods:

Year ended 30 June 2015

The scheme commences on:

20XX

Relevant facts and circumstances

Your country of origin is Country A.

You are a citizen of both Country A and Australia.

You are married with children.

Your spouse departed Australia in 20XX to commence a work assignment in Country A for a period of two years, which is expected to extend for a further six months.

You and your children joined your spouse soon after to enjoy a four week family holiday in Country A.

You returned to Australia to assist your one of your children to prepare for their first year of university and to attend to maintenance on the family home prior to re-joining your spouse back in Country A.

Under company policy you and your spouse were provided with temporary accommodation in Country A for the first three months of your spouse's assignment. In 20XX your spouse entered into a long term lease on a property in Country A.

As per your spouse's work assignment agreement you are entitled to an annual return flight to Australia. You have returned to Australia a number of times in 20XX for periods of 28, 46 and 32 days.

You have a family home in Australia jointly owned by yourself and your spouse. Both your children continue to reside in the family home. When you return to Australia you also reside in the family home.

You have advised the Australian Electoral Commission that you had departed Australia.

You advised your Australian private health insurance provider to have your policy suspended.

You have a rental property in Australia which is jointly owned by yourself and your spouse.

You have kept Australian bank accounts.

You advised your bank that you are a foreign resident.

You have a Country A bank account.

Your spouse has a car in Australia for your use on your return trips to Australia. You have two other cars in Australia kept exclusively for the use of your children. You have two cars in Country A.

You took your personal items with you to Country A.

You have lodged tax returns in Country A as a non-resident. This is because you must reside in Country A for 5 years before you are considered a resident for tax purposes.

You are not a member of an Australian Commonwealth Government superannuation fund.

Relevant legislative provisions

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

Income Tax Assessment Act 1936 Subsection 6(1)

Reasons for decision

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:

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 from the date you departed Australia.

You were a resident of Australia for tax purposes prior to your departure from Australia in 20XX. You ceased being an Australian resident for tax purposes from 20XX. You are entitled to a tax free threshold for the period you were a resident of Australia.

Copyright notice

© Australian Taxation Office for the Commonwealth of Australia

You are free to copy, adapt, modify, transmit and distribute material on this website as you wish (but not in any way that suggests the ATO or the Commonwealth endorses you or any of your services or products).