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This edited version has been archived due to the length of time since original publication.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: 1051362448890

Date of advice: 17 April 2018

Ruling

Subject: Residency

Question

Are you a resident of Australia for taxation purposes for the 2014, 2015 2016 and 2017 income years?

Answer

Yes

This ruling applies for the following periods:

Year ended 30 June 2014

Year ended 30 June 2015

Year ended 30 June 2016

Year ended 30 June 2017

The scheme commences on:

1 July 2013

Relevant facts and circumstances

You were born in country Y.

You are an Australian citizen.

You are not a permanent resident of any other country.

You have been living and working in Country Z since the 2013 income year.

You have been working for the same employer in Country Z.

You have an employment pass to work in Country Z.

This employment pass allows you to remain in Country Z as long as you are employed in Country Z.

You have lived in two apartments in Country Z since moving to Country Z.

Your spouse and child joined you in Country Z in the 2015 income year.

You took personal belongings and household items with you to Country Z.

You purchased furniture in Country Z.

You have not been in Australia for more than 183 days in the 2014, 2015, 2016 and 2017 income years.

Your mother-in-law lived in your family home while your spouse was living in Country Z.

You have a rental property in Australia.

You have never been a Commonwealth Government employee.

Your spouse is a Commonwealth Government employee and contributes to the PSS super 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 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.

The terms resident and resident of Australia, in regard to an individual, are defined in subsection 6(1) of the Income Tax Assessment Act 1936.

The definition offers four tests to ascertain whether each individual taxpayer is a resident of Australia for income tax purposes. These tests are the:

The primary test for deciding the residency status of each individual is whether they reside 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.

As you are the spouse of a contributing member of the PSS super fund we will firstly consider the Commonwealth Superannuation fund test before providing an explanation of the remaining 3 tests.

The Commonwealth superannuation fund test

“The superannuation test is the third statutory test. This test covers current Commonwealth government employees and states that you are an Australian resident if you are:

If you are an Australian resident under this test, your spouse and any children under the age of 16 are also regarded as Australian residents for income tax purposes.”

Your spouse is a Commonwealth government employee and is a contributing member of the PSS super fund.

As the spouse of a Commonwealth Government employee and the spouse of a contributing PSS member you are a resident under this test.

You will be a resident under this test even if you do not meet any of the other 3 tests of residency.

The resides (ordinary concepts) test

The outcomes of several Administrative Appeals Tribunal (AAT) cases have determined that the word 'resides' should be given the widest meaning and there have been a number of factors identified which can assist in determining if a particular taxpayer is a resident of Australia under this test.

Recent case law decisions have considered the following factors in relation to whether the taxpayer was a resident under the ‘resides’ test:

These factors are similar to those which the Commissioner has said are relevant in determining the residency status of individuals in IT 2650 and Taxation Ruling TR 98/17 Income tax: residency status of individuals entering Australia.

It is important to note that not one single factor is decisive and the weight given to each factor depends on individual circumstances.

You were a resident of Australia for taxation purposes in the 2014, 2015, 2016 and 2017 income years as you were the spouse of a contributing member of the PSS Commonwealth superannuation fund.

You will remain a resident of Australia for taxation purposes as you are the spouse of a contributing member of the PSS Commonwealth superannuation fund.

The domicile test

If a person’s domicile is Australia they will be an Australian resident unless the Commissioner is satisfied they have a permanent place of abode outside of Australia.

A person's domicile is generally their country of birth. This is known as a person's 'domicile of origin'. In order to show that an individual's domicile of choice has been adopted, the person must be able to prove an intention to make his or her home indefinitely in that country.

Your domicile is Australia.

The expression 'place of abode' refers to a person's residence, where they live with their family and sleep at night. In essence, a person's place of abode is that person's dwelling place or the physical surroundings in which a person lives.

A permanent place of abode does not have to be 'everlasting' or 'forever'. It does not mean an abode in which a person intends to live for the rest of his or her life. An intention to return to Australia in the foreseeable future to live does not prevent the taxpayer in the meantime setting up a permanent place of abode elsewhere.

As discussed above you were a resident of Australia for taxation purposes in the 2014, 2015, 2016 and 2017 income years and you will remain a resident of Australia for taxation purposes as you are the spouse of a contributing member of the PSS Commonwealth Superannuation Fund for the period you are living outside Australia.

You are a resident under this test.

The 183-day test

Where a person is present in Australia for 183 days during the year of income the person will be a resident, unless the Commissioner is satisfied that the person’s usual place of abode is outside Australia and the person does not intend to take up residence in Australia.

You were a resident of Australia for taxation purposes for the 2014, 2015, 2016 and 2017 income years and you will remain a resident of Australia for taxation purposes for the period you are living outside Australia as you are the spouse of a contributing member of the PSS Superannuation fund.

Your residency status

You are a resident of Australia for taxation purposes under each of the tests of residency for the 2014, 2015 2016 and 2017 income years.

A taxpayer who is a resident of Australia for taxation purposes is required to declare their world-wide income in their Australian tax return.

For the whole period you have been a spouse of a Commonwealth government employee who is a contributing PSS member you were a resident of Australia for taxation purposes and required to declare your world-wide income in your Australian tax return.

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