Quy v FC of T

Court:

MEDIA NEUTRAL CITATION: [2025] ARTA 174

C Willis (General Member)

INTRODUCTION

1. The issue in this matter is whether Mr Trong Jeremy Quy (the 'Applicant') was a resident of Australia for taxation law purposes for the income years ended 30 June 2016 to 30 June 2020 (the 'Relevant Years').

2. The Applicant has worked for many years in various engineering roles with the same employer. Some of these roles were based in Perth, with others in Dubai and, more recently, Thailand. Broadly, the Applicant says that he was not a resident of Australia for taxation purposes in any of the Relevant Years as his home was in Dubai in those years. The Commissioner of Taxation (the 'Respondent') contends that the Applicant remained a resident of Australia for Australian tax purposes in each of the Relevant Years.

3. The residence of the Applicant is relevant to the question of whether he is subject to tax in Australia on the salary and wages he was paid while working in Dubai. Tax was withheld by his employer from his salary and wages for the Relevant Years under the Australian 'pay as you go' ('PAYG') system, and the Applicant originally lodged his income tax returns for those years on the basis that he was an Australian resident for taxation purposes. However he subsequently received advice that he should not have been treated as an Australian resident and is therefore seeking a refund of the Australian tax that was withheld during those years.

4. This matter was the subject of an earlier decision of the Tribunal in February 2024,^[1] Quy and Commissioner of Taxation [2024] AATA 245 (the ‘Previous Tribunal Proceeding’). which found in favour of the Respondent. The Applicant appealed this decision to the Federal Court which decided^[2] Quy v Commissioner of Taxation (No. 3) [2024] FCA 726 . to remit the matter back to the Tribunal.

5. Prior to the hearing in this remittal proceeding, there was discussion around the extent to which I should consider evidence, submissions and other material (such as hearing transcripts) relating to the Previous Tribunal Proceeding. The Applicant had retained different advisors during the course of the Previous Tribunal Proceeding and in the Federal Court, and at one stage was self-represented, before appointing new advisors for this remittal proceeding. The Previous Tribunal Proceeding was heard over multiple days due to administrative or procedural matters arising. There were different versions of key documents prepared at various stages of the earlier Tribunal and Federal Court processes.

6. The Federal Court had ordered that the decision in the Previous Tribunal Proceeding be quashed and the matter be remitted to the Tribunal 'for determination according to the law.' I made Directions for the purposes of this remittal proceeding that the parties provide the Tribunal with the following documents relating to the Previous Tribunal Proceeding:

• • the Statements of Facts, Issues and Contentions (SFICs) filed by each party.
• • the written closing submissions filed by each party.
• • the T-Documents^[3] The term T-Documents or Supplementary T-Documents refers to documents required to be lodged by the Respondent with the Tribunal under the former Administrative Appeals Tribunal Act 1975 (Cth) or current Administrative Review Tribunal Act 2024 (Cth), as modified by section 14ZZF of the Taxation Administration Act 1953 (Cth) (the ‘TAA 1953’). lodged by the Respondent.
• • the Witness Statement filed by the Applicant.
• • the Witness Statement filed by the Applicant's wife (Mrs Quy).
• • a copy of a Certificate of Title for a property in East Victoria Park which had been marked as an exhibit in the Previous Tribunal Proceeding.

7. I also directed that each party identify any affidavits or further evidence on which it intended to rely in this proceeding, and that the Respondent file any Supplementary T-Documents. The following material was filed:

• • An affidavit of the Applicant affirmed on 30 October 2024.
• • An affidavit of Mr Yan, representative of the Respondent, sworn on 11 November 2024 and annexing copies of a hearing transcript from the Previous Tribunal Proceeding, the Certificate of Title mentioned above and affidavits of the Applicant and Mrs Quy filed in the Previous Tribunal Proceeding.^[4] It is noted that these affidavits contained similar content to the witness statements mentioned in paragraph 6.

8. At the conclusion of the hearing the parties sought permission to file further written submissions and the Tribunal agreed to this request.^[5] See Respondent’s Closing Submissions and Applicant’s Closing Submissions, each dated 17 December 2024.

9. On 14 October 2024 the AAT became the Administrative Review Tribunal (the 'Tribunal'). Under the transitional provisions in the Administrative Review Tribunal (Consequential and Transitional Provisions No. 1) Act 2024 (the 'Transitional Act'), applications for review to the AAT that were not finalised before 14 October 2024 are taken to be applications for review to the Tribunal. The Transitional Act gives the Tribunal the authority to continue and finalise any aspect of the review not already completed by the AAT. This decision and statement of reasons is made by the Tribunal.

RELEVANT LAW

10. Some basic principles drawn from Australian income tax legislation provide context in this matter. Income tax is payable by an individual for each financial year. Income tax is worked out by reference to the 'taxable income' of the individual for the relevant income year (which is usually the same as the financial year). The difference between the assessable income of the individual and deductions is their taxable income (or may result in a tax loss if deductions exceed assessable income): see generally sections 4-1, 4-10 and 4-15 of the Income Tax Assessment Act 1997 (Cth) (the 'ITAA 1997').

11. 'Assessable income' includes income according to ordinary concepts, called 'ordinary income': subsection 6-5(1) of the ITAA 1997. Salary and wages are an example of amounts that have long been accepted as 'ordinary income.' The assessable income of an Australian resident includes the ordinary income they derived (directly or indirectly) from all sources, whether in or out of Australia, during the income year: subsection 6-5(2). However, the assessable income of a foreign resident only includes ordinary income derived (directly or indirectly) from Australian sources, together with ordinary income that any other provision of the taxation legislation includes in assessable income.

12. The Respondent accepts that the salary or wages earned by the Applicant from his employment in Dubai has a foreign source.^[6] See for example Respondent’s closing submissions dated 17 December 2024 at paragraph 9. Therefore, if the Applicant is not an Australian resident that income should not be subject to tax in Australia.

13. The Dictionary in section 995-1 of the ITAA 1997 provides that a 'foreign resident' means a person who is not resident in Australia for the purposes of the Income Tax Assessment Act 1936 (Cth) (the 'ITAA 1936'). Similarly, an 'Australian resident' is defined to mean a person who is a resident of Australia for the purposes of the ITAA 1936.

14. In relation to an individual subsection 6(1) of the ITAA 1936 provides that a 'resident' or 'resident of Australia' means:

• a) a person, other than a company, who resides in Australia and includes a person:
  • (i) whose domicile is in Australia, unless the Commissioner is satisfied that the person's permanent place of abode is outside Australia;
  • (ii) who has actually been in Australia, continuously or intermittently, during more than one-half of the year of income, unless the Commissioner is satisfied that the person's usual place of abode is outside Australia and that the person does not intend to take up residence in Australia; or
  • (iii) who is:
    • (A) a member of the superannuation scheme established by deed under the Superannuation Act 1990; or
    • (B) an eligible employee for the purposes of the Superannuation Act 1976; or
    • (C) the spouse, or a child under 16, of a person covered by sub-subparagraph (A) or (B)

15. The parties agree that the Applicant and Mrs Quy are not, and have never been, Commonwealth employees or members of Commonwealth superannuation funds. Nor are they under the age of 16.^[7] See T2, Objection Decision at paragraph 2 and the Applicant’s affidavit dated 30 October 2024, at paragraph 104. References to T Documents and Supplementary T Documents are to documents that were required to be provided by the Respondent to the Tribunal in accordance with section 14ZZF of the TAA 1953. Therefore subparagraph (a)(iii) of the definition does not apply to any of the Relevant Years and need not be considered further.

16. The Respondent also agrees that based on records documenting the Applicant's travel between Australia and the UAE, the Applicant was not in Australia (continuously or intermittently) for more than one-half of any of the Relevant Years. Therefore the '183 day test' in subparagraph (a)(ii) of the definition does not apply to any of the Relevant Years and need not be considered further.

17. Having regard to subparagraph 6(1)(a)(i), the ITAA 1936 and ITAA 1997 do not provide any further statutory definition of concepts of 'residence' or 'permanent place of abode.' These concepts have been the subject of considerable case authority in Australian and foreign courts, which will be discussed in greater detail below having regard to the particular circumstances of the Applicant.

18. The Respondent has issued public guidance, which it applied in making its Objection Decision, and which is reflected in its contentions in this proceeding. This includes Taxation Ruling TR 98/17 'Income tax: residency status of individuals entering Australia' and Taxation Ruling IT 2650 'Income tax: residency - permanent place of abode outside Australia', which were both withdrawn in 2022 but were operative during the Relevant Years. These public rulings were replaced by Taxation Ruling TR 2023/1 'Income tax: residency tests for individuals.' The Tribunal is not bound to follow these rulings, but the promotion of consistency of decision making supports the Tribunal taking this guidance into account, provided it is consistent with law and judicial authorities.^[8] See for example, Plaintiff M64/2015 v Minister for Immigration and Border Protection [2015] HCA 50 at [54] .

BACKGROUND

Circumstances of the Applicant

19. Although the parties dispute the meaning or relevance of many factual matters, the following items were not in contention.

20. The Applicant was born in Vietnam in 1962 and migrated to Australia in 1978. He initially lived in Sydney, where he met Mrs Quy, who had also been born in Vietnam and migrated to Australia as a teenager. The Applicant and Mrs Quy were married in 1990 and now have three adult daughters. Both the Applicant and Mrs Quy are Australian citizens.

21. In 1986 the Applicant commenced work in Sydney as a draughtsman in the engineering office of a company called CBI Constructors ('CBI').

22. In 1992 the Applicant and Mrs Quy jointly purchased a property in Parramatta (the 'Parramatta Property').

23. In 1998 CBI moved its engineering office from Sydney to Perth. After initially being offered a role in Perth (which he declined), the Applicant accepted a position as a mechanical engineer with the Dubai office of CBI (or a Dubai based entity within the CBI group).

24. Mrs Quy resigned from her employment in Sydney and the Applicant, Mrs Quy and their three daughters (then all aged under five) moved to Dubai in January 1998. The family lived in Dubai for the next 12 years, with the daughters attending an international school there. The Applicant and Mrs Quy retained the Parramatta Property as an investment, leasing it out during this time.

25. In October 2009 the Applicant was offered a new position in CBI's engineering office in Perth, which he accepted. The Quy family relocated from Dubai to Perth. In February 2010 the Applicant and Mrs Quy purchased a property in Beldon, Western Australia (the 'Beldon Property').

26. CBI closed its Perth engineering office in 2012 and the Applicant accepted a role working for CBI on a project associated with the construction of the Gorgon gas plant. In this role the Applicant worked from a project office based in Perth. The duration of the project was approximately three years.

27. After their return to Perth, Mrs Quy had worked as a bookkeeper, before establishing a business in 2014, which she ran from premises leased by her. Mrs Quy also undertook volunteer work in Perth. From 2010 to 2015 their daughters attended school and university in Perth.

28. The Applicant also became the registered proprietor of an apartment in Merrylands, New South Wales (the 'Merrylands Property') in 2014, which he purchased from his brother. The Applicant took over the mortgage on the Merrylands Property previously taken out by his brother. The Merrylands Property was leased to a tenant.

29. Around 2015 the Applicant's project role was finishing and he was offered a new role by CBI as a Senior Structural Design Engineer Specialist. This role was a full-time permanent position and was based in Dubai. The daughters were now older (aged 19 to 22), and were studying at university or completing year 12, so it was agreed that they would remain in Perth and would continue to live at the Beldon Property.

30. The terms of the Applicant's employment in this role were set out in Base Terms and Conditions^[9] T41. provided by CBI dated 29 September 2015, together with an accompanying Assignment Letter dated 9 July 2015.^[10] T44. These two documents indicated that:

• • The Applicant was employed for the Specified Task set out in the Assignment Letter.
• • His employment in this role commenced on 29 September 2015^[11] The Assignment Letter said the start date was 2 August 2015, subject to immigration status being obtained. and would cease at the completion of his 'international assignment'. The Assignment Letter said that his assignment was expected to be for a period of 24 months but could be extended, or terminated earlier.
• • His employer was CBI but he was assigned to CBI Eastern Anstalt (CBIEA), an entity within the CBI group established in Dubai, for the duration of the assignment.
• • His point of hire was Perth.^[12] However, the Assignment Letter said the ‘point of origin’ was New South Wales.
• • The Base Terms and Conditions said that his employment contract was governed by Australian law.
• • The Base Terms and Conditions expressed his remuneration package in Australian dollars, with salary to be paid fortnightly to his nominated Australian bank account. Superannuation contributions were to be paid in accordance with the Australian superannuation guarantee legislation.
• • The Assignment Letter said that he would continue to receive his base salary, paid into his bank account 'as normal' and maintained in accordance with 'home company guidelines and conditions.' However, the Applicant would also be subject to a UAE Ministerial Resolution for the 'Wages Protection System.' This was mandatory for all employers registered in the UAE and required salary payments to 'all employees registered under the [Ministry of Labour]' to be paid through the Wages Protection System, in UAE Dirham and into a UAE bank account. Accordingly the Applicant was required to open a UAE bank account^[13] See sample HSBC account statement at T56. so that a portion of his salary could be paid into that account.
• • The Assignment Letter also provided that the Applicant would receive cost of living, accommodation and utilities allowances, all paid in UAE Dirham. A furnishings allowance of USD5,000 and a relocation allowance of USD5,000 were also included in the remuneration package. Allowances were to be paid to the 'host country' (that is, UAE) bank account.
• • The Applicant was covered by his employer's International Medical Insurance Plan while he was on assignment in Dubai.
• • He was entitled to four weeks of annual leave for each year of service under the Base Terms and Conditions, together with specified travel days if on a 'home leave trip.'

31. The Applicant and Mrs Quy:

• • retained the Beldon Property, paying bills and outgoings for the property while their daughters were living there.
• • did not take furniture and household items from the Beldon Property to Dubai.
• • left two Toyota Corolla cars, a Toyota Landcruiser, a Harley Davidson motorcycle and a trailer in Perth. The vehicles continued to be registered in the name of the Applicant, who paid for ongoing registration and insurance costs.
• • retained their family private health insurance policy in Australia.
• • continued to own and lease out the Parramatta Property and Merrylands Property.
• • kept open Australian bank accounts.

32. The Applicant held UAE Dubai Residency Permits collectively covering the period from October 2015 to August 2021,^[14] T52 to T54. entitling him to live and work in Dubai during this period. Mrs Quy also held UAE Residency Permits covering the period from January 2016 to November 2019.^[15] T58 and T59.

33. The Applicant travelled from Perth to Dubai on 13 September 2015.

34. After arriving in Dubai the Applicant initially stayed in a hotel while being shown various apartments available for lease. Around October 2015 a lease was entered into by CBIEA for an apartment (the 'Dubai Apartment'), on a yearly basis with an option to renew each year. The Applicant lived in the Dubai Apartment from around early November 2015 to early 2021.^[16] See copies of leases at T45 to T50 with terms commencing on 1 November 2015 and ending on 30 April 2021. See also documents dated February 2021 at T65 and T66 referring to moving out arrangements for Applicant. To the extent that the rent on the Dubai Apartment was more than the accommodation allowance he received from his employer, the Applicant paid the difference.

35. The Applicant bought a Mitsubishi Pajero vehicle in Dubai. The Pajero was registered in the Applicant's name and registration and insurance charges were paid by him.^[17] T60, T61, T67.

36. The Applicant obtained a new mobile phone in Dubai, as well as arranging connections for home internet, in his name.^[18] T39. Other utility connections at the Dubai Apartment (such as water, electricity and sewerage) appear to have been in the name of CBIEA.^[19] T40.

37. The Applicant opened a bank account and obtained a credit card with HSBC in Dubai.^[20] See sample account statement at T57. The Applicant had also retained a bank account in Australia. A portion of his salary and wages was paid into his Dubai bank account and the remainder was paid into the Australian bank account. Expenses for the Beldon Property and mortgage payments for his Australian investment properties were paid from the Australian bank account. The Applicant had a mortgage offset arrangement linked to his Australian bank account.

38. Between the time of his initial arrival in Dubai in September 2015 and the end of 2020, the Applicant returned to Australia on 12 occasions, for periods ranging from five days to 35 days. Incoming and Outgoing Passenger Cards were completed by the Applicant when he travelled between Dubai and Australia during that period. The following items can be noted about the Applicant's completion of these forms:

• • In Outgoing Passenger Cards^[21] T72, T74, T76, T78, T80. the Applicant has ticked the box for 'Australian resident departing temporarily' although the documents filed with the Tribunal do not include information for each of his departures from Australia, and only cover dates in 2015 to early 2017.
• • In those Outgoing Passenger Cards the Applicant has stated an 'intended length of stay overseas' which appears to align to the time remaining on the Applicant's initial two year UAE Residency Permit.
• • In Incoming Passenger Cards the Applicant has ticked the box for 'resident returning to Australia' on two cards,^[22] See T73 dated December 2015 and T82 dated August 2017. selected the box for 'visitor or temporary entrant' on nine cards^[23] T77, T79, T81, T83 to T88. and seemingly filled in both sections on one card.^[24] See T75 dated December 2015. On all such cards the Applicant has nominated the UAE as his country of residence or place where he spent the most time abroad. However, on each such card the Applicant ticked 'no' to the question 'do you intend to live in Australia for the next 12 months?'

39. Mrs Quy travelled from Perth to Dubai on 4 January 2016. At that time she completed an Outgoing Passenger Card stating that she was an 'Australian resident departing permanently' with the UAE as her country of future residence.^[25] T89. Mrs Quy's overall pattern of travel between Australia and Dubai was different to that of the Applicant. She travelled between the two countries on multiple occasions across 2016 to 2019. Incoming and Outgoing Passenger Cards were also completed by Mrs Quy for this travel. In each of the Incoming Passenger Cards Mrs Quy ticked the box for 'resident returning to Australia.'^[26] T90, T92, T94 to T101. On some of these cards she answered 'no' to the question of whether she intended to live in Australia for the next 12 months, on others she answered 'yes.'

40. Mrs Quy travelled from Dubai to Australia in mid-December 2019 and remained there until she travelled to Dubai again in March 2021. It is noted that this period coincided with extended restrictions on movements between different countries due to the COVID-19 pandemic. Records obtained by the Respondent from the Department of Immigration and Border Protection (the 'DIBP') indicate that in each of the Relevant Years, Mrs Quy spent the majority of time in Australia.

41. Movement Records obtained by the Respondent from the DIPB indicate that the Applicant's daughters travelled to the UAE during the 2016/2017 Christmas/New Year period.^[27] T104 to T106.

42. In 2020 one of the Quy daughters moved out of the Beldon Property and relocated to Sydney, now living in the Parramatta Property. A further property in East Victoria Park (the 'East Victoria Park Property') was purchased, with the Applicant and a second daughter in 2022 registered as joint tenants on 31 January 2022.^[28] The Certificate of Title for the East Victoria Park Property also refers to the Applicant being at that address. The second daughter is living in the East Victoria Park Property.

43. The Applicant subsequently accepted a new role with CBI in Thailand and moved there in 2021. The Applicant and Mrs Quy have lived in Thailand ever since.

Respondent's review and objection processes

44. The Applicant lodged income tax returns for the Relevant Years. These were prepared and lodged by tax agents on his behalf. The returns included within assessable income all of the Applicant's earnings from his employment in Dubai in those years. His employer had withheld and remitted amounts of (Australian) tax under the PAYG system. The Respondent had issued notices of assessment (the 'Original Assessments') for the Relevant Years, reflecting this approach.

45. Subsequently, the Applicant obtained tax advice from a different adviser to the effect that he was not a resident of Australia for tax purposes during the Relevant Years and therefore should not have reported his gross earnings from his work in Dubai as assessable income, nor should his employer have withheld amounts for PAYG. The Applicant therefore lodged an objection in relation to each of the Original Assessments on 29 March 2021 (the 'Objections').

46. The Respondent issued his decision on the objections (the 'Objection Decision') on 6 January 2022 allowing in part the Objections for the 2016 to 2019 years^[29] The Respondent accepted the Applicant’s claims for deductions for capital allowances and capital works expenses relating to the Merrylands Property. and disallowing the Objection for the 2020 year.

47. The Respondent decided that the Applicant was a resident of Australia for the Relevant Years because he satisfied the primary 'resides test' according to the ordinary meaning of that term. The Applicant also satisfied the domicile test.^[30] T2, page 8. The Respondent accepted that the '183 day' test was not relevant to the Applicant, and the 'superannuation' test did not apply to him.^[31] T2. Neither the Applicant nor his wife had been a Commonwealth employee or a member of a Commonwealth superannuation fund.

48. The Respondent issued amended assessments (the 'Amended Assessments') for the 2016 to 2019 income years accordingly.

49. As amounts of tax were already deducted from the Applicant's salary under the PAYG system, the Applicant does not have an outstanding tax debt, but is instead seeking a refund of the tax that was previously deducted and remitted to the Respondent.

Tribunal and Federal Court proceedings

50. The Applicant originally applied to the Tribunal for a review of the Objection Decision on 29 March 2022. The matter was initially heard by the Tribunal on 5 May 2023, after which there were further directions hearings to manage procedural matters that had arisen after the hearing. Final written submissions were not received by the Tribunal until October 2023. The Tribunal provided its decision on 26 February 2024, affirming the decision of the Respondent.

51. The Applicant appealed to the Federal Court under section 44 of the (former) Administrative Appeals Tribunal Act 1975 (Cth). As observed by Logan J, this process is more correctly described as a statutory appeal on a question of law heard in the Federal Court's original jurisdiction.^[32] Trong Quy v Commissioner of Taxation (No 3) [2024] FCA 726 at [2] per Logan J. The Applicant was successful before the Federal Court, with Logan J ordering that the decision of the Tribunal dated 26 February 2024 be quashed and the matter be remitted to the Tribunal for determination according to law.

52. His Honour held that the decision in the Previous Tribunal Proceeding contained an error of law in relation to 'the Tribunal's understanding and application of the residence under ordinary concepts aspect of the definition of resident.'^[33] Ibid, at paragraph [23]. This arose from a reference to intention for the purposes of determining a person's domicile being incorporated into the reasoning relating to residence under ordinary concepts.^[34] Ibid, at paragraphs [17] to [19].

53. The matter was listed for a fresh hearing before the Tribunal. The Applicant returned to Australia to attend and give evidence at the hearing. Mrs Quy did not give evidence at this remittal hearing.

Issues and contentions

54. The parties agree that the Tribunal must decide, in relation to each of the Relevant Years, whether the Applicant:

• • Was a resident of Australia according to 'ordinary concepts'.
• • Had a permanent place of abode outside Australia.

55. The Respondent accepts that the Applicant may have been a resident (on ordinary concepts) of the UAE or Dubai in each of the Relevant Years, however, contends that the Applicant was also a resident of Australia in those years. The Applicant accepts that it is possible for a person to be a resident of two countries at the same time, however, contends that he ceased to be a resident of Australia in those years.

56. In relation to subparagraph (a)(i) of the definition of a resident of Australia, both parties now appear to agree that the Applicant has an Australian domicile. The Respondent says, however, that the Commissioner (or Tribunal) cannot be satisfied that the Applicant's permanent place of abode was outside Australia in any of the Relevant Years. The Applicant contends that there is sufficient evidence to demonstrate that he had a permanent place of abode in Dubai in those years.

57. As this matter involves a review of an objection decision concerning assessments, the Applicant has the burden of proving that the assessments are excessive or otherwise incorrect, and what the assessments should have been: subparagraph 14ZZK(b)(i) of the TAA 1953.

REASONING

58. Derrington J at first instance in Harding v Commissioner of Taxation (Harding) observed that:^[35] Harding v Commissioner of Taxation [2018] FCA 837 at [5] per Derrington J.

The questions which arise in the present case are not easily answered. The characterisation of a person as a resident of one country or another for the purposes of the ITAA when the person works in one place and yet retains a house and family in another involves an analysis which is fraught with some difficulty…

One might also add that the established definition of "residence" may, in some respects, not necessarily accommodate the manner in which some people presently live and work.

59. Such challenges arise in the present matter. To answer the statutory questions, an analysis and weighting of factual matters is required, and the parties are in dispute over the details of many of these factual matters. It is not controversial that the Applicant bears the burden of proving the assessments issued to him are excessive or incorrect (and what they should be). The Respondent claims that the Applicant's version of facts has changed over time, demonstrates multiple inconsistencies and is not supported by contemporaneous documentary evidence. The Applicant refutes that the evidence he has given is inconsistent or has changed, and has sought to provide an explanation of matters where documentary evidence is lacking or unclear.

60. The question of whether a person is a resident of a place is 'ordinarily one of degree, and therefore of fact.'^[36] Commissioner of Taxation v Miller (1946) 73 CLR 93 (‘ Miller’ ) per Rich J. A significant volume of factual detail was canvassed before the Tribunal. In reviewing the material provided to the Tribunal for the purposes of this proceeding, which includes material prepared for the Previous Tribunal Proceeding, the evidence given at the hearing and the submissions provided by the parties, the approach of the Tribunal must involve identifying which factual matters are relevant to the statutory questions and then determining the weight to be given to conclusions of fact drawn in this context.

61. Taxpayers are assessed on a yearly basis and therefore it is necessary to consider the residence status of the Applicant in each of the Relevant Years. However, in this case many of the factual conclusions will apply to all of the years. Similarly, the same conclusions of fact may be relevant to both of the tests of residence being considered, although with a different emphasis in the context of different statutory wording.

Residence according to ordinary concepts

62. The definition of a 'resident' or 'resident of Australia' in paragraph 6(1)(a) of the ITAA 1936 refers to a person who 'resides' in Australia. There is no further statutory definition of the term 'resides', although a number of case authorities describe a well-established ordinary meaning that a person resided where they 'lived' or 'keep house and do business', where they 'dwell permanently or for a considerable time', have their 'settled or usual abode' or 'live in or at a particular place.'^[37] Harding (Full Court) at [57], citing Miller at 99-101 per Latham CJ and Levene v Inland Revenue Commissioners [1928] AC 217 .

63. The intention of the person, as well as their physical presence, may be relevant to the determination of residence. In Hafza v Director-General of Social Security (Hafza), Wilcox J said:^[38] Hafza v Director-General of Social Security (1985) 6 FCR 444 at 449-450 per Wilcox J. As noted by the Full Court in Harding , although Hafza involved social security legislation, that legislation incorporated the ITAA 1936 definition of ‘resident.’

Physical presence and intention will co-incide for most of the time. But few people are always at home. Once a person has established a home in a particular place - even involuntarily: see
Commissioners of Inland Revenue v Lysaght [1928] AC 234 at 248 and
Keil v Keil [1947] VR 383 - a person does not necessarily cease to be resident there because he or she is physically absent. The test is whether the person has retained a continuity of association with the place -
Levene v Inland Revenue Commissioners [1928] AC 217 at 225 and
Judd v Judd (1957) 75 WN (NSW) 147 at 149 - together with an intention to return to that place and an attitude that that place remains "home": see
Norman v Norman (No 3) (1969) 16 FLR 231 at 236. It is important to observe, firstly, that a person may simultaneously be a resident in more than one place … and secondly, that the application of the general concept of residence to any particular case must depend upon the wording, and underlying purposes, of the particular statute in relation to which the question arises. But, where the general concept is applicable, it is obvious that, as residence of a place in which a person is not physically present depends upon an intention to return and to continue to treat that place as "home", a change of intention may be decisive of the question whether residence in a particular place has been maintained.

64. In considering whether a person who is not physically present in Australia can still be regarded as residing in Australia, the intention of the person to return to that place and treat it as their home is relevant. The subjective intention of the person, whether based on their contemporaneous statements or otherwise may assist in this inquiry, but an examination of objective facts and circumstances is likely to provide a more accurate indication of their intention as to their presence.^[39] See Harding (at first instance) at [43] to [46] per Derrington J, Comcare Australia (Defence) v O’Dea (1998) 87 FCR 451 (‘ O’Dea’ ).

65. In its public guidance,^[40] See Taxation Rulings TR 2023/1 and TR 98/17W, noting that these are largely written from the perspective of an individual who is entering Australia, rather than a citizen who has left. the Respondent acknowledges these authorities, and suggests a series of factors that would commonly be taken into account in determining whether a person has the relevant 'continuity of association'^[41] See also the summary of case authority by Derrington J in Commissioner of Taxation v Addy [2020] FCAFC 135 (‘ Addy ’) at [76] referring to the concept of ‘continuity of association.’ The High Court allowed the taxpayer’s appeal on another point. with Australia such that they should be regarded as a resident. Broadly, these are the factors that the Respondent considered in its Objection Decision. The Respondent also acknowledges that no single factor is decisive and the weight given to each factor varies depending on individual circumstances.^[42] See Taxation Ruling TR 2023/1 at paragraphs [20] and [21].

66. As noted in Hafza, a person may be a resident of more than one place at the same time.^[43] See also Miller , Gregory v Deputy Federal Commissioner of Taxation (WA) (1937) 57 CLR 774 . This is relevant to the circumstances of the Applicant, as the Respondent accepts that the Applicant may be regarded as residing in Dubai in each of the Relevant Years, but contends that he also resided in Australia in those years. The focus of the following discussion, aligned to the statutory question, is therefore whether the Applicant (also) resided in Australia in those years.

Physical presence in Australia

67. The frequency and duration of a person's physical presence in Australia, as well as the purpose of their presence, may provide insight into whether they have an intention to treat Australia as their home.

68. On the basis of records obtained from DIBP and facts agreed by the parties, it is not disputed that the Applicant spent the significant majority of his time in each of the Relevant Years outside Australia (and in Dubai), and that this was as a consequence of his work assignment. It is also not disputed that the Applicant travelled from Dubai to Australia on 12 occasions from December 2015 to January 2021,^[44] It is noted that one of these trips was in November 2020 to January 2021, which is outside the Relevant Years and the Applicant noted that this trip was longer in duration due to COVID-19 pandemic travel restrictions. with the majority of these visits being for two to three weeks. When the Applicant came to Australia, he either stayed at the Beldon Property or went to Sydney where extended family lived. The Applicant's employment terms and conditions provided for specified weeks of annual leave (plus days for travel), but otherwise his role was full time in Dubai.

69. The Respondent said that the fact that the Applicant returned to Australia on multiple occasions indicated an ongoing continuity of association or connection with Australia in each of the Relevant Years. His absence from Australia, even for significant periods, was not sufficient of itself to dissolve his residence. The Respondent also pointed to statements made by the Applicant in his Outgoing and Incoming Passenger Cards suggesting that he believed he retained his Australian residence in at least some of those years.

70. The Applicant said that his travel to Australia in the Relevant Years was for holidays or to visit his daughters and extended family, and reflected his contractual entitlement to annual leave. In relation to the Passenger Cards, the Applicant's representative suggested that some of the questions on those documents might be misunderstood by people without legal training, particularly where the alternative options on the cards did not clearly align to an individual's specific circumstances. Further, the terminology of 'resident', 'temporary entrant', 'visitor', 'departing permanently' and similar as set out in the cards are not necessarily consistent with the taxation law concepts. It was submitted that the best indication of the Applicant's intention was the fact that he answered 'no' to the plain English question 'do you intend to live in Australia for the next 12 months' on each of the Incoming Passenger Cards.

71. Travellers to and from Australia are asked to verify that the information they provide in Passenger Cards is true, correct and complete, and are warned that serious consequences may follow from making inaccurate statements. The statements made by the Applicant in some of the Passenger Cards to the effect that he was a resident of Australia in one or more of the Relevant Years cannot be ignored, and there is case authority suggesting that such statements could be treated as an admission by him of his status as a resident of Australia.^[45] See the discussion of Taylor v Natwest Australia Bank Limited (Unreported, Full Court of the Federal Court, 16 October 1992) at paragraph [63] of Harding (first instance). However, it is clear from the way in which the Passenger Cards have been completed by the Applicant that there was some confusion on his part as to the meaning of some of the questions. For example, he dated some of the Outgoing Passenger Cards with his date of birth rather than the date of his departure from Australia. On other Passenger Cards, he has completed then crossed out a section, or given information that was apparently contradictory. Outgoing Passenger Cards are not available for departures after mid-2017.

72. Frequent return trips to Australia could well suggest a retained association with Australia, although in the present circumstances the Tribunal accepts that the Applicant was more likely to be treating these trips as visits or holidays, such that in each of the Relevant Years the Applicant's intention was not to treat Australia as his 'home' or where he lived. This is consistent with his utilisation of his annual leave entitlements for the visits, and his negative response on Incoming Passenger Cards as to whether he intended to live in Australia for the next 12 months.^[46] Although it is acknowledged that the Federal Court has found that an individual who made similar and consistent statements on passenger cards was a resident of Australia so the matter is not determinative: see Pike v Commissioner of Taxation [2020] FCAFC 158 (‘ Pike’ ) at [4] and [17] per Davies, White and Steward J affirming the decision of the primary judge.

73. The duration and nature of the Applicant's absence from Australia tends in favour of his not being a resident under ordinary concepts. However, the Tribunal agrees with the Respondent's contention that mere physical absence from Australia is not sufficient to negate residence in Australia, and that the question of continuity of association between the Applicant and Australia must be considered further.

Employment and remuneration arrangements

74. The Applicant's physical absence arose from his full-time role based in Dubai. The terms and conditions under which the Applicant was employed in Dubai were included in the documents filed with the Tribunal. It is not disputed that the Applicant had a longstanding employment history with CBI, having previously undertaken another lengthy work assignment in Dubai with this employer as well as moving his family within Australia (from Sydney to Perth) to pursue roles with this employer. The Respondent did not contest the evidence of the Applicant that CBI had moved their engineering office from Sydney to Perth, and then closed the Perth engineering office, which prompted his relocations for work in his specific qualifications as an engineer. After completing his Dubai assignment, the Applicant moved to Thailand for another assignment in an engineering role.

75. The Respondent pointed to specific terms in the employment contract, together with remuneration arrangements, which it said were indicative of the Applicant's ongoing and extensive connection with Australia during the Relevant Years. When the Applicant took up the role in 2015, it was for a fixed term of 24 months (albeit subject to extension, but also subject to earlier termination). His point of hire was Perth and the terms of employment contemplated travel allowances for 'home leave' (to Australia), and he did in fact use his annual leave entitlements to travel back to Perth.

76. The Applicant did not view the fact of having an Australian employer or an employment contract that was subject to Australian law as being of great significance to the question of his residence. For the purposes of the particular work assignment, his 'host' entity (if not his legal employer) was a Dubai established entity within the CBI group. Dubai was the 'host location' identified in the employment contract. The Applicant also noted that his employment contract was based on 'standard terms' which were not negotiated for his particular circumstances, and therefore should not be viewed as particularly informative of his intention.

77. At least some of the Applicant's salary was paid by his Australian employer in Australian dollars into his existing Australian bank account. However, there was disagreement between the parties about the detail of payments of the Applicant's salary. The Respondent's characterisation of the arrangements was that the Applicant's base salary was paid into his Australian bank account, except for a 'relatively small amount' that was paid into his Dubai bank account in compliance with the UAE 'Wages Protection System'. The Applicant said that he estimated the amount he required for living expenses in Dubai, which was paid into his Dubai bank account and then any amount remaining went to his Australian bank account.

78. The Respondent's characterisation is consistent with the written terms and conditions of employment. The Respondent said it had sought copies of statements for the Applicant's Australian bank account but these had not been provided. The Applicant was unable to explain why he did not provide the statements. On that basis, it is difficult for the Tribunal to verify the Applicant's characterisation of the salary payments.

79. However on balance, the employment arrangements are consistent with the Applicant not regarding Australia as his 'home' in any of the Relevant Years. His overall employment contract is comprised of two related documents, one of which (the Base Terms and Conditions) reflects the legal status of his employment by an Australian company and the other (the Assignment Letter), which deals with the terms of his specific assignment in Dubai and reflects legal requirements of the host country where he was located. The Assignment Letter provided for various living allowances to support the Applicant in making his work location his home for the duration of his assignment.

Family in and other personal connections to Australia

80. In Harding, Derrington J observed that 'in all but the most exceptional circumstances' the maintenance of a house in Australia by an individual, and the maintenance of a family in that house, will be of 'great significance' in determining the individual's residency for taxation purposes as this likely indicates an expectation of returning to that place and an enduring continuity of association with Australia.^[47] Harding (at first instance) at [50] per Derrington J, affirmed by the Full Court. See also Pike at [16].

81. It is not disputed that the three Quy daughters, who had travelled to the UAE with their parents during the Applicant's previous work assignment in Dubai, did not accompany the Applicant to live in Dubai in any of the Relevant Years. At the time of the previous work assignment they were of primary school age, but in the Relevant Years they were completing their secondary education or university studies. They remained at the Beldon Property after their father travelled to Dubai in 2015, until such time as they moved out (in two instances to other properties owned by the Applicant). The Quy daughters appear to have travelled to the Middle East around Christmas 2016, but returned to Australia in early 2017. The Applicant also has extended family living elsewhere in Australia.

82. The parties acknowledge that Mrs Quy moved to Dubai with the Applicant (and their daughters) during his previous work assignment in Dubai. In relation to the more recent work assignment, records obtained from DIBP indicate that Mrs Quy travelled from Perth to Dubai in early 2016, but returned to Perth within a few weeks. Thereafter she travelled several times between Perth and Dubai, with her stays in Dubai generally being of shorter duration. Mrs Quy travelled from Dubai to Australia in mid-December 2019 and remained there until she travelled to Dubai again in March 2021. In each of the Relevant Years the majority of her time was spent in Australia, in all but the 2017 year substantially so. In her January 2016 Outgoing Passenger Card she stated that she was an Australian resident departing permanently with the UAE as her country of future residence, although she returned to Australia later that month. In each of her Incoming Passenger Cards Mrs Quy ticked the box for a 'resident' returning to Australia. Her responses to the question of whether she intended to live in Australia for the next 12 months varied. When Mrs Quy was in Perth she lived at the Beldon Property, and she was financially supported by the Applicant during those years.

83. The Respondent contended that in the context of their ongoing relationship it is significant that Mrs Quy did not move to Dubai with the Applicant but spent most of her time in the Relevant Years in Australia, and this in turn demonstrates a continuity of association between the Applicant and Australia. The Respondent's counsel drew the Tribunal's attention to apparent inconsistencies between statements made by the Applicant that his wife resided with him in Dubai during the Relevant Years,^[48] See for example paragraphs 25, 35 and 77 of the Applicant’s witness statement dated 30 October 2024. evidence given by Mrs Quy at the Previous Tribunal Proceeding, evidence given by the Applicant at the hearing in this proceeding^[49] At the hearing the Applicant agreed that although the original intention may have been for Mrs Quy to move to Dubai to live with him, in reality this did not happen. and the passenger records obtained from DIBP.

84. The Tribunal agrees with the Respondent that to the extent of any inconsistency, the contemporaneous passenger records obtained from DIBP are to be preferred. It is clear from those records that Mrs Quy lived in Australia for the majority of days in each of the Relevant Years and overall spent the substantial majority of her time in Australia during that period. It would be a stretch to conclude that she 'resided' with the Applicant in Dubai in those years in the sense in which that term is used in taxation legislation. If the Applicant meant that Mrs Quy lived with him at the Dubai Apartment when she visited Dubai during those years, that would be an accurate statement. As a matter of objective fact, Mrs Quy was physically present in Australia for the majority of each of the Relevant Years and spent significant time apart from the Applicant.

85. The Applicant ultimately acknowledged that Mrs Quy spent significantly more time in Australia than the Applicant, however, said that this should not result in the Applicant being imputed with an intention to treat Australia as his home in any of the Relevant Years. Evidence was given by the Applicant and by Mrs Quy at the Previous Tribunal Proceeding that she returned to Australia for different reasons at various times, including to support her daughters with their studies, care for her mother who was seriously ill and assist a vulnerable member of her community. Mrs Quy did not give evidence at the remittal hearing so other than acknowledging externally imposed travel restrictions during the COVID-19 pandemic, the details of why Mrs Quy remained in Australia could not be verified.

86. It is important to reiterate that this proceeding is not about the residence of Mrs Quy, and matters relating to Mrs Quy's residence are only relevant to the extent that they shed light on the connection between the Applicant and Australia for the purpose of determining whether he resided in Australia in any of the Relevant Years. Although the maintenance of close family, including a spouse, in a location can be strongly indicative of residence in that location, it is not conclusive. Some caution needs to be exercised in making assumptions about what behaviour would be appropriate or expected from a spouse, even in the context of a longstanding marriage described as being of a 'traditional' nature.

87. It was reasonable for the three Quy daughters to remain in Perth for the final years of their senior schooling and university studies. From the wider evidence given about the family arrangements, the Tribunal does accept that Mrs Quy wanted to support her daughters as they completed their senior education. Against that background (and COVID-19 travel restrictions), the fact that Mrs Quy spent the majority of the Relevant Years in Australia does not require the conclusion that the Applicant considered his 'home' was in Australia in those years. It is noted that Mrs Quy made frequent trips to Dubai during these years, which could be viewed as consistent with her visiting her husband in the place which he treated as his home for the time being.

88. The Applicant stated that he severed social and personal ties in Perth when preparing to leave for Dubai in 2015, such as advising the Vietnamese folk music group to which he belonged that they would need to find a replacement guitarist and stepping back from his musical commitments at his church. He said that after he arrived in Dubai he took up various social and community activities, including attending a new church, in that location. The evidence on this point is equivocal. Objectively, the limited time that the Applicant spent in Australia during the Relevant Years suggests that he would not have had much time for significant involvement in social or community activities there. However, the Applicant did acknowledge that he left musical instruments and other equipment relating to his hobbies at the Beldon Property, and he rode his Harley Davidson motorbike when he returned. The Respondent queried the evidence he gave relating to the extent of his social and community activities in Dubai. The evidence on this point is not of great assistance in assessing the intention of the Applicant for the purposes of the ordinary concepts test of residence. As discussed later, it is of more relevance to the question of whether he established a permanent place of abode outside Australia.

Maintenance of property, investments and other assets in Australia

89. It is not disputed that the Applicant retained real property in Australia throughout the Relevant Years, including the Beldon Property, which had been the family home for many years, and the Parramatta Property and Merrylands Property which had been long term investments of the Quy family. The Applicant subsequently purchased (or contributed to the purchase) of a further property in East Victoria Park, albeit after the Relevant Years. Two of the Quy daughters occupy, or have occupied, the Parramatta Property and East Victoria Park Property.

90. The Applicant agreed that he did not transport his furnishings and household goods from the Beldon Property to Dubai, other than a limited number of personal items. His employer provided an allowance for the purchase of new furnishings in Dubai, and he then left most of those furnishings behind in Dubai when he moved to Thailand.

91. The fact that the Applicant continued to own and maintain a house in Australia throughout the Relevant Years, being the house in which he had lived for a number of years, is objectively significant evidence when considering his intention in relation to residing in Australia in those years. It is also relevant that the Applicant did not take furniture and other household items with him when he travelled to Dubai in 2015, even though his employer would pay for shipping. The Respondent argues that this demonstrates a significant continuity of association with Australia.

92. The Applicant said that he retained the Beldon Property as a place for his three daughters to live while they completed their senior school and university studies in Perth. His daughters were at important stages of their education, such that they would need to remain in Australia. If the daughters had not stayed in the Beldon Property, he would likely have had to pay for the rent on a property for them as they were not earning an income at that time. For the same reason, he left the Beldon Property furnished for their benefit. As his employer was providing funds for the purchase of new furniture in Dubai, it was not necessary for him to ship significant household goods from Perth to Dubai. After he was settled into the leased Dubai Apartment he did purchase new furniture, using his own funds to cover the difference in cost between the furnishings he chose and the allowance from his employer.

93. The Respondent noted that photographs of the Dubai Apartment furnishings provided by the Applicant during the Objection process suggested that the apartment had been sparsely furnished. A significant amount of time was spent during cross examination of the Applicant on the topic of whether he purchased his furnishings in Dubai from a well-known Swedish lifestyle brand, and if so, whether the furnishings could therefore be described as 'high quality.' The point that the Respondent may have sought to make was that the Applicant did not apply the same level of resources to furnishing the Dubai Apartment as he might have done for the Beldon Property, suggesting a more tenuous link to Dubai and/or a stronger connection to the Beldon Property in Australia. The Respondent also implied that the reliability of the Applicant's evidence might be questioned since he exaggerated the quality of the furnishings purchased in Dubai.

94. The Applicant said that when he left Dubai he gave much of that furniture away, as his new accommodation in Thailand was already furnished. He also moved to Thailand during the COVID-19 pandemic, which created challenges in terms of shipping goods internationally. The photographs he provided to the Respondent had been taken for the purposes of advertising some of those items online as he was packing up, and did not reflect the entirety of the furniture and homewares that had been in the Dubai Apartment.

95. In the particular circumstances of the Applicant, his retention of a house in Perth is not inconsistent with him holding the intention to cease his residency in Australia in each of the Relevant Years. It is explicable by the need to house and otherwise provide for his daughters while they completed their education. Although each case must be determined on its particular facts, this conclusion is similar to that reached in Harding in which the taxpayer maintained a house in Australia while his child completed their schooling, and where the taxpayer stayed when he returned to Australia. In that case, having regard to the totality of evidence the Court found that the taxpayer was effectively on holidays visiting his family when he stayed there, and did not 'reside' at that house.^[50] Harding (at first instance) at [60] per Derrington J. The Full Court did not disagree with this finding.

96. The Tribunal accepts the Applicant's evidence that the photographs did not reflect the entirety of the furnishings in the Dubai Apartment. The Applicant appears to have furnished the Dubai Apartment to the extent necessary for a reasonably comfortable life in Dubai, and the furnishings were not insubstantial or temporary. Otherwise, debate over the quality of these furnishings or a comparison to the Beldon Property furnishings does not greatly assist an assessment of whether the Applicant retained an association with Australia or had the intention to treat Australia as his home in any of the Relevant Years.

97. The Applicant acknowledged that he retained Australian bank accounts throughout the Relevant Years, and that superannuation contributions were made by CBI into his Australian superannuation fund as part of his remuneration package during his assignment in Dubai. His explanation was that the Australian bank accounts were required for various expenses of his daughters and the Beldon Property in which they lived. He also had existing repayment and offset arrangements for the mortgages on his other investment properties linked to his Australian bank accounts. The Applicant retained the Parramatta Property and Merrylands Property as investment properties during the Relevant Years.

98. The maintenance of investments and other financial affairs in Australia has been viewed by courts as not necessarily indicating a continuing intention to maintain residency in Australia, particularly where they reflect ongoing responsibilities to support dependents in Australia. A person may hold investments in a different place to where they reside.^[51] See Harding (Full Court) at [63] agreeing with the observations of Derrington J at first instance at [84] to [85]. The Tribunal accepts that there was a reason for the Applicant to maintain bank accounts in Australia in the context of his ongoing financial support for his daughters.

99. Although one of the daughters did subsequently move into the Parramatta Property, the retention of that property and the Merrylands Property is a factor indicative of an ongoing association with Australia. However, this must be weighed against the other relevant factual matters.

100. The Applicant was physically absent from Australia for the significant majority of each of the Relevant Years. Although the Respondent has identified some matters which were indicative of the Applicant having a continuity of association with Australia in each of the Relevant Years, the objective evidence is consistent with the Applicant's position that he did not have the intention to treat Australia as his 'home' in those years. It is true that he continued to own a house in Perth and left it furnished, however, he was responsible for providing a place for three daughters to live while they completed their education in Perth. It is also true that he visited and stayed at that house on several occasions during the Relevant Years, but this was consistent with taking annual or holiday leave from his full time job in Dubai to visit his family. Due to the limited time he spent in Australia, it would not have been possible for him to continue his former Perth based social and community activities in those years. During the Relevant Years, Mrs Quy spent more time in Australia with her daughters than in Dubai with her husband, however, this is not determinative of her husband's intention in relation to his home during those years. Although his employer was an Australian company and at least some of his employment terms were governed by Australian laws, he was provided with a place to live and allowances to support his ongoing necessities in Dubai through the Dubai host entity.

101. In these circumstances the Tribunal has concluded that the Applicant did not 'reside' in Australia under the ordinary concepts test in any of the Relevant Years.

Domicile test: permanent place of abode outside Australia

102. Where a person is not a resident of Australia according to ordinary concepts, they may nevertheless be regarded as a resident under subparagraph (a)(i) of the definition which includes as a resident a person whose domicile is in Australia, unless the Respondent is satisfied that the person's permanent place of abode is outside Australia. The domicile test operates to extend the 'ordinary concepts' test.

103. The Respondent submitted that the Applicant's domicile is in Australia, based on the Australian citizenship he acquired after migrating to Australia as a child.^[52] See generally section 10 of Domicile Act 1982 (Cth). The Applicant did not appear to dispute this, and his contentions relating to his residency under the 'domicile test' were based on his position that he had his permanent place of abode outside Australia (in Dubai) in each of the Relevant Years. The Tribunal therefore accepts that the Applicant should be treated as a person whose domicile was in Australia in each of the Relevant Years.

104. The Full Court in Harding observed that subparagraph (a)(i) turns upon the Respondent's 'state of satisfaction' that a person had a permanent place of abode outside Australia, and said:^[53] Harding (Full Court) at [17] to [18] per Davies and Steward JJ.

Where a provision reserves to the Commissioner the task of fact finding, on a Part IVC appeal in the [Tribunal], which exercises administrative, not judicial, power, the Tribunal can re-examine for itself on the evidence before it whether it is satisfied that a taxpayer has a permanent place of abode outside Australia…

105. The following principles were identified by the Full Court:

• • The exception in subparagraph (a)(i) assumes that the person is not physically present, but is still domiciled, in Australia during the relevant year of income.^[54] Ibid at [36].
• • What has to be 'definitely abandoned' for the purposes of subparagraph (a)(i) is not 'Australia' but 'residence' in Australia.^[55] Ibid at [36] and [38].
• • Although the phrase 'place of abode' usually refers to the dwelling where a person lives, it is not limited to a specific house, flat or other dwelling but could include a town, country or state in which a person is physically residing 'permanently.'^[56] Ibid at [40] and [48].
• • The word 'permanent' does not require the person to have formed an intention to live or reside or have a place of abode outside Australia 'indefinitely' without any definite intention of ever returning to Australia. The question is whether the person has abandoned any residence or place of abode they may have had in Australia. It is to be contrasted with a 'temporary' or 'transitory' place of abode outside Australia.^[57] Ibid at [45], agreeing with the observations of Northrop J in Federal Commissioner of Taxation v Applegate (1979) 38 FLR 1 at 12 .

106. The Applicant said that he abandoned his residence in Australia and had a permanent place of abode in Dubai during the Relevant Years. He pointed to the fact that he took up a full-time job in Dubai, that he moved his personal belongings associated with his pattern of living to Dubai and that he severed his social ties in Australia. Although the Dubai Apartment was leased on an annual basis, he lived there for five years and he chose that apartment with the intention of living there other than on a temporary basis. The Applicant and Mrs Quy furnished the Dubai Apartment themselves, partly with their own funds and in a manner which did not suggest a mere temporary presence. The Applicant contended that his history of working in Dubai and subsequent move to Thailand also informed the nature of his presence in Dubai during the Relevant Years.

107. The Respondent contended that while the Applicant might have been physically present in Dubai for the significant portion of the Relevant Years, he did not act in a manner consistent with an individual intending to quit Australia and set up a permanent place of abode elsewhere. That is, the Respondent said that the Tribunal should not be satisfied that the Applicant had an intention to make Dubai his permanent place of abode. More particularly, the reason for the Applicant's presence in Dubai was solely for the purposes of an international work assignment with his Australian employer. His ability to remain in Dubai was entirely dependent on a temporary residence permit linked to sponsorship by his host company. The lease on the Dubai Apartment was in the name of his employer, which also paid for utilities for the property. The Respondent viewed the nature of the furnishings in the Dubai Apartment as being 'transient' and not indicative of an intention to set up a new home. Further, the Applicant disposed of the furnishings (and the vehicle he purchased in Dubai) when he moved to Thailand. The Respondent queried the reliability of the evidence given by the Applicant as to his social connections and activities in Dubai. Finally, the Respondent highlighted matters which demonstrated the Applicant's ongoing association with Australia, including his family, investment and financial arrangements, which were not indicative of a person intending to permanently quit Australia. In summary, the Respondent did not believe that the quality of the Applicant's engagement with Dubai was consistent with a person who permanently resided there (or intended to).

108. The Respondent's submissions in this proceeding reflect its public guidance to taxpayers on residence issues. The Respondent identifies the length of a person's stay overseas, the nature of the accommodation they occupy and the durability of their association with that location as relevant factors in relation to a permanent place of abode, but notes that the entirety of the facts and circumstances of the person, including intention and conduct, must be considered.^[58] See Taxation Ruling TR 2023/1 at paragraph 71 to 82. This Taxation Ruling was issued after the Relevant Years but consolidates material from two prior public rulings, IT 2650 and TR 98/17 as updated to take account of case law including Harding , Pike and Addy .

109. A number of the findings of fact discussed previously in relation to the 'ordinary concepts test' are also relevant to the 'domicile' test. However, rather than focussing on the degree of connection between the Applicant and Australia, the question here is whether the Applicant had established a permanent place of abode outside Australia.

Accommodation and manner of living outside Australia

110. The Applicant's presence in Dubai was subject to having the required UAE Dubai Residency Permit. Each permit was issued for a period of 24 months, with the Applicant holding permits for almost six years in aggregate. As the issuance and terms of visas and residency permits are subject to UAE laws applicable to non-citizens, this matter is not particularly helpful as an objective indicator of the Applicant's intention.

111. Save for an initial period of a few weeks when he stayed at a hotel, the Applicant lived at the Dubai Apartment in each of the Relevant Years. The fact that his accommodation was rented, on a yearly basis, does not necessarily preclude it from being regarded as a permanent place of abode.^[59] Ibid at [55], noting Harding involved rental of fully furnished serviced apartments. However, it is relevant that the lease for the Dubai Apartment, as well as utility connections for the property, were in the name of his employer (or the Dubai based host entity within his employer's group).^[60] At paragraph 56 of his witness statement dated 30 October 2024 the Applicant said all utilities bills were in his name, but this does not appear to be correct. See T40.

112. The Applicant chose the Dubai Apartment, as well as purchasing furnishings for the Dubai Apartment with an allowance from his employer together with personal funds. As noted above, the Tribunal has not placed much weight on whether these furnishings were particularly expensive or exclusive or whether they were sourced from a more affordable retail outlet. The Tribunal accepts that the photos provided by the Applicant to the Respondent during the objection process are unlikely to show the full extent of the furnishing of the Dubai Apartment while he was living there. The Tribunal's conclusion is that the Applicant furnished the Dubai Apartment with what was needed for a comfortable existence during his time in Dubai, and the furnishings were not insubstantial.

113. The Tribunal accepts that the Applicant did take key personal belongings with him when he travelled from Perth to Dubai in 2015, but this is not determinative of establishing a 'permanent place of abode' there. These items were consistent with what might be required for living in Dubai on a longer term, but not necessarily permanent, basis.

114. The Applicant pointed to social and recreational activities and networks that he established in Dubai, either by himself or with Mrs Quy when she was there. He said that he played the musical instruments that he had brought with him from Australia, and attended church in Dubai. He bought sporting equipment in Dubai, for use in Dubai. The Respondent queried why he did not provide evidence, such as photographs or text messages, demonstrating his participation in these activities, and why the Applicant had not referred to the extent of these activities during the objection process. The Tribunal accepts that it is likely that the Applicant engaged in social and recreational activities locally during each of the Relevant Years when he was living in Dubai. As there is other evidence of the Applicant and his family being people of faith, the Tribunal is willing to accept, without having photographic evidence of him during worship, that the Applicant attended church in Dubai.

115. The Applicant also gave evidence that Mrs Quy undertook volunteer work, attended church events and otherwise participated in significant social activities in Dubai.^[61] See paragraphs 69 to 71 of the Applicant’s witness statement dated 30 October 2024. Mrs Quy did not give evidence at the remittal hearing and the extent of any such activities was not explored in the Previous Tribunal Proceeding. The Respondent queried how extensive these activities could be in light of DIBP records suggesting her time in Dubai was not extensive. Due to a lack of corroborative evidence, the Tribunal cannot give significant weight to the Applicant's statements in relation to his social and community life with Mrs Quy in Dubai.

116. The evidence relating to accommodation and social arrangements of the Applicant in Dubai is equivocal in the context of the 'domicile' test and would not provide a sufficient basis for being satisfied that the Applicant had established a place of abode in Dubai that was more than temporary or transitory. There are further factors to be considered.

Intention to abandon residence in Australia

117. Despite not treating Australia as his home in the Relevant Years, the Applicant maintained connections with Australia that are objectively inconsistent with his 'abandoning' residence in Australia and making Dubai a 'permanent' (in the sense of not temporary) home. Only some of these connections may be explained as necessary for the support of his dependent daughters.

118. Where a person working overseas maintains a home in Australia where their family lives, this is often a significant indicator of an ongoing association between that person and Australia, but may not be determinative.^[62] See Pike at [16] per Davies, White and Steward JJ; by contrast Harding (Full Court) at [24]. Similarly, frequent returns by the person to the Australian home and the family based there would ordinarily suggest an ongoing connection to Australia, although in some circumstances the quality and nature of the trips might be consistent with mere social visits by a person who has abandoned their Australian residence.

119. It was not disputed that the Applicant purchased a four wheel drive vehicle in Dubai for his use while living there, although he also retained vehicles in Australia. The Applicant said that some of these vehicles were for the use of his daughters, although he agreed that he kept a motorcycle and four wheel drive in Perth for 'sentimental reasons' and did in fact use the motorcycle when he returned to Perth during the Relevant Years. The Applicant maintained his West Australian driver's licence and reregistered the vehicles located in Perth in his name. He explained this by reference to the inconvenience of letting existing licences and registrations lapse, although this would presumably only be of concern if he anticipated resuming driving in Australia and using his Australian vehicles. He disposed of the vehicle he purchased in Dubai when he moved to Thailand.

120. The Applicant also acknowledged that he left other personal belongings at the Beldon Property, including winter clothing (not required in Dubai's climate) and two guitars that he had been restoring. These were not required for use by his daughters or Mrs Quy.

121. The Applicant kept a family private health insurance policy in Australia. This may be explained by the need to insure his dependents, at least until his daughters became financially independent, so the Tribunal does not find this matter of significance in the circumstances.

122. The Applicant retained bank accounts in Australia from which expenses for his family and the Beldon Property, as well as mortgage payments on his other Australian investment properties, were made. His employment terms and conditions provided for amounts of salary and wages to be paid into his Australian bank accounts (although the allocation of amounts between the Applicant's UAE and Australian bank accounts was the subject of disagreement between the Applicant and Respondent). His employer paid superannuation contributions in accordance with Australian superannuation guarantee legislation into his Australian superannuation fund throughout the Relevant Years. This was a requirement of Australian law rather than something negotiated between the Applicant and his employer, however these funds remained in Australia for his benefit.

123. Although the Applicant's explanation for these arrangements may have been consistent with an intention that he not live in Australia as his 'home' in any of the Relevant Years for the purposes of the ordinary concepts test, they take on a slightly different complexion in the context of assessing whether he had definitely 'abandoned' residence in Australia for the purposes of the domicile test.

124. The question of whether a person has a permanent place of abode outside Australia goes beyond whether they can demonstrate that they were living, working and socialising in another place, even for an extended period of time. They must demonstrate that they have abandoned their residence in Australia, and established a place where they are residing permanently (rather than on a temporary basis, even if not indefinitely). Having regard to all of the facts, the Tribunal cannot be satisfied that the Applicant had a 'permanent place of abode' outside Australia in any of the Relevant Years.

125. Each case must turn on its own facts and circumstances, and matters which carry significant weight towards a particular conclusion in one case may not do so where there are countervailing factors. Both the Respondent and Applicant referred to aspects of the decisions in Harding in support of their respective submissions, and there is some similarity between the circumstances of Mr Harding and those of the Applicant. The conclusion reached by the Tribunal in this proceeding differs to the outcome in Harding. As a general observation, the Federal Court's description of Mr Harding's circumstances indicated a strong commitment on his part to settling in Bahrain permanently for the lifestyle offered in the Middle East as well as for professional reasons, and this was regardless of personal or family connections in Australia. There was an 'unchallenged finding of fact' relating to Mr Harding's intention when leaving Australia.^[63] Harding (Full Court) at [54]. That is not the case with the Applicant who has moved to various locations, within and outside Australia, following different work assignments with his long-term employer.

CONCLUSION

126. For the reasons given above, the Applicant was not a resident of Australia under the 'ordinary concepts' test in any of the Relevant Years. However, as a person whose domicile was in Australia, the Tribunal is not satisfied that his 'permanent place of abode' was outside Australia in any of the Relevant Years. Therefore, the reviewable decision of the Respondent that the Applicant was a resident of Australia for the purposes of the definition in subsection 6(1) of the ITAA 1936 in each of the Relevant Years is affirmed.

DECISION

The Tribunal affirms the decision under review.