Edited version of private advice

Authorisation Number: 1052001584109

Date of advice: 6 July 2022

Ruling

Subject: International organisations - exempt income

Question

Does section 6-20 of the Income Tax Assessment Act 1997 (ITAA 1997) apply to exempt the payments you received as an employee of the International Organisation on the basis that they are exempted by subsection 6(1) of the International Organisations (Privileges and Immunities) Act 1963 (IOPIA 1963)?

Answer

Yes.

Having considered your circumstances and the relevant factors, it is accepted you meet the relevant factors contained in Draft Taxation Ruling TR 2019/D1 and that you are considered to hold an office with an international organisation.

Therefore, as prescribed by the relevant regulations, the payments you receive from the International Organisation are exempt income under the IOPIA 1963 and section 6-20 of the ITAA 1997.

This ruling applies for the following periods:

Year ending 30 June 20XX

Year ending 30 June 20XX

Year ending 30 June 20XX

The scheme commences on:

1 July 20XX

Relevant facts and circumstances

You are a resident of Australia for tax purposes.

You are currently on leave without pay from your Australian employer.

You have just commenced a contract working for the International Organisation based in Country B.

You arrived in Country B a few months ago, moving your belongings and setting up a house.

You are a senior employee with responsibility for research and development and associated activities.

The position encompasses some major functions or Key Result Areas.

The expertise that is required for the role includes a combination of knowledge, experience, qualifications or equivalent learning through experience or key skills, attributes or job specific competencies.

Your employment commenced earlier this year.

The contract is for a number of years, which is standard for International Organisation. It might be extended, subject to satisfactory performance and ongoing funding. You believe that it is likely that it will be extended.

The group that you work in has secure ongoing funding and deliverables, which you believe is more secure than other divisions within the organisation. Your group has increased the number of employed staff recently. You are one of many people who have taken up a stock assessment role over many years. The work is ongoing and will continue into the foreseeable future. It existed before you went into the role, and you are certain continue to exist for many years into the future.

You are classed as an employee of the International Organisation and are currently answerable and reporting to Person A.

You do not have anybody reporting to you.

There is nobody who you could engage to help you with your work, nor do you have the authority to do so. Only employees and contractors of the International Organisation are allowed to do this work.

You are paid a monthly salary.

You are entitled to 25 working days of annual leave per annum.

You have no obligation to return to correct any work beyond the specifications of your duties. You have no obligation to return to correct defects. You are not a contractor nor a consultant.

You work at headquarters in City A, in the business premisses of the International Organisation.

None of your work is undertaken in Australia, so far only in Country B - and, possibly later, depending on restrictions relating to COVID, attending some meetings in other countries.

You currently pay for your own accommodation (with a subsidy from the International Organisation), and for your own telephone internet and private travel expenses.

Your understanding is that work related travel expenses would be paid by the International Organisation, if and when that happens.

When taking up your position, all these expenses were covered. This included travel to get there, short term accommodation, utilities, travel insurance and health insurance.

You have health insurance in Country B, paid for by your employer, as is standard for all employees.

You use a computer for work provided by the International Organisation. You have an office with a fixed line phone provided by the International Organisation, as is standard for all their employees. All of this equipment was supplied by the International Organisation, so there was no need for any reimbursement.

Relevant legislative provisions

Income Tax Assessment Act 1997 Subsection 6-5(2)

Income Tax Assessment Act 1997 Subsection 6-15(2)

Income Tax Assessment Act 1997 Section 6-20

The International Organisations (Privileges and Immunities) Act 1963

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).