Edited version of private advice

Authorisation Number: 1052235525005

Date of advice: 10 April 2024

Ruling

Subject: Residency

Issues

Question

Is the Taxpayer a resident of Australia for the purposes of subsection 6(1) of the Income Tax Assessment Act 1936, for the income year ending 30 June XXXX?

Answer

No. The Taxpayer is not a resident of Australia for income tax purposes for the XXXX income year.

This ruling applies for the following periods:

1 July XXXX to 30 June XXXX

Relevant facts and circumstances

Generally

The Taxpayer was born on XXXX in Australia.

The Taxpayer lived in Australia until XXXX, when they moved to Country A.

Family

The Taxpayer married their spouse in XXXX.

They have one child who was born on XXXX.

The spouse and child moved to the Country A with the Taxpayer in XXXX.

The Taxpayer has an elderly parent as well as a sibling living in Australia.

Move to Country A

On XXXX, the Taxpayer moved to Country A on a visa.

The Taxpayer was accompanied by their spouse and child on the visa.

The visas of the Taxpayer, their spouse and child were originally valid until XXXX. The visas were continually renewed until XXXX when all members of the family were granted Indefinite Leave to Remain in Country A.

The Taxpayer, their spouse and child live in an apartment in Country A.

The Taxpayer signed a three-year lease in respect of the apartment and pre-paid the entire rent for the period. The Taxpayer and their family moved in on XXXX.

The Taxpayer's spouse has since bought the apartment via a company structure. The family continues to live at this address and has no intention of moving from it whilst they live in Country A.

The Taxpayer intends to remain in Country A for the foreseeable future while they pursue business opportunities in the region.

Australian assets and associations

Upon their departure in XXXX, the Taxpayer undertook an extensive number of actions to end their association with Australia, including those set out below.

The Taxpayer had been a Company Secretary and/or Public Officer of a number of entities in Australia. They resigned from all these positions upon their move to Country A, replaced by individuals who ordinarily reside in Australia.

For those companies where they had been the sole director, a minimum of two (additional) Australian resident directors were appointed ensuring compliance with the Corporations Act 2001.

The Taxpayer remains involved to a limited extent with a number of companies, trusts and partnerships in Australia.

Upon moving to Country A, the Taxpayer resigned as secretary and public officer of the following:

•         X;

•         X;

•         X;

•         X;

•         X;

•         X.

The Taxpayer and their spouse granted a Power of Attorney to an Australian resident, to act in relation to property transactions for X and X.

The Taxpayer has a partnership with their parent. The Taxpayer's parent administered the partnership for several years with the assistance of a locally based accountant. Recently, this administrative process was handed over to another entity. The Taxpayer's parent remains the public officer.

The Taxpayer and their spouse had maintained a Self-Managed Superannuation Fund (the Fund). As a result of their move, the Fund's assets were transferred to an APRA regulated fund and the Fund was wound up.

The Taxpayer wrote to their legal advisors, financial advisors, tax advisors, auditors and bankers to inform them they were moving overseas:

The Taxpayer's name was removed from the electoral roll for their electorate.

The Taxpayer cancelled their Medicare registration and their medical insurance when they departed Australia.

The Taxpayer advised their GP and medical specialists to remove them as a patient.

Australia Post was notified that all mail addressed to the Taxpayer's home be redirected to a post office box which is emptied twice a week by a professional services firm. Important mail is shipped to the Taxpayer in Country A; unimportant mail is marked 'Moved Overseas' and returned to sender.

The Taxpayer advised service providers to liaise with a professional services firm on all Australian-based assets.

The Taxpayer's child attended their last day of school in Australia on XXXX. The school, was notified that the family was moving overseas.

Upon moving to Country A, the Taxpayer disposed of the following properties:

•        X;

•        X; and

•        X.

The former family home in Australia, which is owned by the Taxpayer's spouse, was not immediately placed on the market due to unfavourable market conditions in the wake of the Global Financial Crisis. Instead, a series of refurbishment actions were taken to prepare it for sale. The property remains in 'caretaker mode'

Country A assets and associations

As set out above, the Taxpayer and their family live in the apartment.

The Taxpayer and their family have no intention of living elsewhere whilst they continue to live in Country A.

The Taxpayer invested funds to confirm their Country A residency as part of the visa requirements.

The Taxpayer appointed a Country A broker to manage their investment portfolio for their investment visa.

The Taxpayer works as a consultant to corporations based in Continent A.

The Taxpayer has made significant investments in Continent A corporations through a mixture of loans and equity holdings.

The Taxpayer has opened bank accounts with various banks in Country A since arriving in Country A.

The Taxpayer obtained credit cards from various banks in Country A.

The Taxpayer registered as a voter in Country A.

The Taxpayer applied for and received confirmation of their entry into Country A's taxation system; they appointed a tax agent and lodge Country A tax returns.

The Taxpayer, their spouse and their child took out private health insurance starting XXXX. This cover has since been cancelled.

The Taxpayer attends a gym in Country A and has hired a personal trainer.

The Taxpayer entered into engagements with a Country A accountant and lawyer.

The Taxpayer applied for and received their Country A driver's licence.

The Taxpayer registered with and has used the services of a doctor in Country A.

The Taxpayer and their family became patients of a Country A dental practice.

The Taxpayer's child attended a Country A school. They have subsequently completed their schooling.

The Taxpayer's spouse is a patron of a Country A Foundation and the family attend events of this charity.

Visits to Australia

After departing Australia on XXXX, the Taxpayer did not come to Australia in the remainder of the income year ending XXXX.

In the income year ending XXXX, the Taxpayer visited Australia twice. Once for a few days to manage their tax affairs; and once to spend Christmas with their family.

In the income year ending XXXX, the Taxpayer visited Australia four times: approximately one week in XXXX to celebrate their child's birthday; one week in XXXX to spend Christmas with their family; X days in XXXX for weddings of close friends; and four days in XXXX for the funeral of their relative.

In subsequent income years, the Taxpayer's pattern of visits has varied - they visited Australia 2- 5 times per year, these visits have been of varying durations.

In the income year ending XXXX, the Taxpayer visited Australia three times, staying a total of 65 nights: 15 nights from XXXX to XXXX, 40 nights from XXXX to XXXX, and 10 nights from XXXX to XXXX. The second visit was extended to spend Christmas and holiday with their elderly parent and extended family.

The Taxpayer is often accompanied by their spouse and child, but they have also travelled alone on occasion. They occasionally visit the former family home to check on its condition and has on occasion stayed there. They usually stay at:

•        In X, at their sister's house, or their mother's house.

•        In X, at Hotel A.

Due to their parent's failing health, the Taxpayer may in the future continue to make trips to Australia to see their extended family.

The Taxpayer has arranged for Australian family members to visit them in Country A, including their parent and sibling, and other extended family members.

Previous Private Binding Rulings

The Commissioner has issued the following private binding rulings, determining that the Taxpayer was not an Australian resident for income tax purposes for periods from XXXX through to 30 June XXXX:

•        Private Ruling Authorisation No 1012441263503.

•        Private Ruling Authorisation No 1012660600815.

•        Private Ruling Authorisation No 1051424264703.

•        Private Ruling Authorisation No 1051641199741.

•        Private Ruling Authorisation No 1051824458301.

•        Private Ruling Authorisation No 1051992580570.

•        Private Ruling Authorisation No 1052094868994.

Relevant legislative provisions

Income Tax Assessment Act 1936 subsection 6(1)

Reasons for decision

Question

Is the Taxpayer a resident of Australia for the purposes of subsection 6(1) of the Income Tax Assessment Act 1936, for the income year ending 30 June XXXX?

Summary

The Taxpayer is not a resident of Australia for income tax purposes for the income year ending 30 June XXXX.

Detailed reasoning

The Commissioner has issued rulings to the Taxpayer which explain the conditions that must be satisfied for Australian residency for tax purposes. In the previous rulings, the Commissioner determined that the Taxpayer was not an Australian resident for income tax purposes for periods from XXXXX through to 30 June XXXX.

Relevantly, the facts for the income year ending 30 June XXXX remain the same as those for the income year ending 30 June XXXX (as set out in private ruling Authorisation Number 1052094868994), apart from the fact the Taxpayer visited Australia three times, staying a total of 65 nights:

•        15 nights from XXXXX to XXXX,

•        40 nights from XXXX to XXXX (the visit was extended to spend Christmas and holiday with their elderly mother and extended family), and

•        10 nights from XXXX to XXXX.

This fact does not displace the findings in the previous abovementioned rulings that the Taxpayer was not a resident of Australia for income tax purposes.

Conclusion

The Taxpayer is not a resident of Australia for income tax purposes for the income year ending 30 June XXXX.

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