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Edited version of private ruling
Authorisation Number: 1011508876750
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Ruling
Subject: Residency status
Question
Are you a resident of Australia for taxation purposes?
Yes.
This ruling applies for the following period
Year ending 30 June 2009
Year ending 30 June 2010
Year ending 30 June 2011
Year ending 30 June 2012
Year ending 30 June 2013
The scheme commenced on
1 July 2008
Relevant facts
A Pty Ltd is an Australian registered company. It is wholly owned by a Country B entity - B Pty Ltd.
Early in the recent year, B Pty Ltd decided to send you to Australia to manage the day to day affairs of A Pty Ltd for an indefinite period of time.
You have been in Australia since this time.
You do not have a permanent abode in Country B.
You rented a unit in Country B that you gave up upon leaving the country.
You have the majority of your assets and personal belongings in Australia.
You have purchased furniture and set up a permanent home in a large Australian city.
You have a personal bank account in Australia.
You have joined various sporting and social clubs in Australia.
You have several friends in Australia that you meet upon a regular basis.
You hope to remain in Australia permanently
You have joined the local Church and established memberships of clubs in Australia.
Relevant legislative provisions
Income Tax Assessment Act 1997 subsection 995-1(1).
Income Tax Assessment Act 1936 subsection 6-1(1).
Reasons for decision
Subsection 995-1(1) of the Income Tax Assessment Act 1997 (ITAA 1997) defines an Australian resident as a person who is a resident of Australia for the purpose of the Income Tax Assessment Act 1936 (ITAA 1936).
The terms resident and resident of Australia, in regard to an individual, are defined in subsection 6(1) of the ITAA 1936. The definition provides four tests to ascertain whether a taxpayer is a resident of Australia for income tax purposes. These tests are:
· The resides test
· The domicile test
· The 183 day test
· The superannuation test
The primary test for deciding the residency status of an individual is whether the individual resides in Australia according to the ordinary meaning of the word resides. If the primary test is satisfied the remaining three tests do not need to be considered as residency for Australian tax purposes has been established.
Taxation Ruling TR 98/17 considers the residency status of individuals entering Australia and states that the period of physical presence or length of time in Australia is not, by itself, decisive when determining whether an individual resides here. However, an individuals behaviour over the time spent in Australia may reflect a degree of continuity, routine or habit that is consistent with residing here.
In your case, although you still have ties with Country B, you are considered to be an Australian resident for taxation purposes under "the resides test" for the following reasons:
You have been in Australia since a particular year.
You do not have a permanent abode in Country B.
You rented a unit in Country B that you gave up upon leaving the country.
You have the majority of your assets and personal belongings in Australia.
You have purchased furniture and set up a permanent home in a large Australian city.
You have a personal bank account in Australia.
You have joined various sporting and social clubs in Australia.
You have several friends in Australia that you meet upon a regular basis.
You hope to remain in Australia permanently
You have joined the local Church and established memberships of clubs in Australia.
Based on the information you have provided, it is considered that you are an Australian resident for taxation purposes as your behaviour in Australia reflects a degree of continuity, routine or habit that is consistent with residing here.