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This edited version has been archived due to the length of time since original publication.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: 1051344893266

Date of advice: 1 March 2018

Ruling

Subject: Residency

Question

Are you a resident of Australia for income tax purposes?

Answer

No

This ruling applies for the following periods:

Year ending 30 June 20XX

Year ending 30 June 20XX

Year ending 30 June 20XX

Year ending 30 June 20XX

The scheme commences on:

XX January 20XX

Relevant facts and circumstances

You are a citizen of Australia.

You and your family have been living outside Australia since mth/year.

Your partner and children have returned to Australia permanently.

You have not returned permanently to Australia and will remain working in Country Y and in mid-20XX you will commence working in Country Z.

You will return to Australia to visit your family and these trips will not exceed 183 days in any financial year.

You expect to spend no more than XX days in Australia.

Your partner will visit you in Country Y and Country Z for one week every 2 months.

Your family will commence living in your family home in Australia once the current tenants vacate the property.

You will stay with your family in the family home when you return to Australia for visits.

Neither you nor your partner are eligible to contribute to the PSS or the CSS Commonwealth superannuation funds.

Relevant legislative provisions

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

Income Tax Assessment Act 1936 Subsection 6(1)

Reasons for decision

Section 6-5 of the Income Tax Assessment Act 1997 (ITAA 1997) provides that where you are a resident of Australia for taxation purposes, your assessable income includes income gained from all sources, whether in or out of Australia. However, where you are a foreign resident, your assessable income includes only income derived from an Australian source.

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.

ATO view documents

Taxation Ruling TR 98/17 – Income tax: residency status of individuals entering Australia

Taxation Ruling IT 2650 – Income tax: residency – permanent place of abode outside Australia

Taxation Ruling IT 2650A (Addendum) – Income tax: residency – permanent place of abode outside Australia

Other references (Non ATO view – example court cases, etc):

Macquarie Dictionary, [Multimedia], version 5.0.0, 1/10/01

Dempsey and Commissioner of Taxation [2014] AATA 335 (29 May 2014)

Federal Commissioner of Taxation v Miller [1946] HCA 23; (1946) 73 CLR 93.

Levene v Inland Revenue Commissioners [1928] UKHL 1; [1928] AC 217.

Applegate v Federal Commissioner of Taxation [1978] 1 NSWLR 126

Does Part IVA or any other anti-avoidance provision apply to this ruling?

The application of Part IVA of the ITAA 1936 has not been considered as this topic is in the SBIT low risk PART IVA list as specified in ORCLA.

Other relevant comments

I have complied with Practice Statements PS LA 2002/16 and PS LA 2003/9 in the completion of this report by checking the Technical Reference Search Engine, and using ORCLA.

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).