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Ruling
Subject: Residency for tax purposes
Question and answer
Will you be a resident of Australia for tax purposes from the time that you depart Australia?
No.
This ruling applies for the following periods:
Year ending 30 June 2013
Year ending 30 June 2014
Year ending 30 June 2015
Year ending 30 June 2016
The scheme commenced on:
1 July 2012
Relevant facts and circumstances
You and your spouse are departing Australia to move to Country X in the year ending 30 June 2013.
You have a three year employment contract in Country X which you hope to renew for a further three years.
You will rent your home in Australia initially and later make a decision as to whether to sell the property.
You will be setting up a home in Country X with your spouse.
You are taking your personal belongings with you to Country X.
You have advised your bank you are moving overseas.
You have no dependent children.
Neither you, nor your spouse, have ever been Commonwealth government employees.
Relevant legislative provisions:
Income Tax Assessment Act 1997 Section 6-5
Income Tax Assessment Act 1936 Subsection 6(1)
Reasons for decision
Generally where you are a resident of Australia for taxation purposes, your assessable income includes income gained from all sources, whether in or out of Australia. However, where you are a foreign resident, your assessable income includes only income derived from an Australian source.
The terms 'resident' and 'resident of Australia', in regard to an individual, are defined within the tax provisions and provides four tests to ascertain the residency status.
Relevant to your situation are the first two tests which are examined in Taxation Ruling IT 2650 Income Tax: Residency - permanent place of abode outside Australia, a copy of which is available from www.ato.gov.au.
Given regard to your circumstances as a whole and a consideration of the relevant residency tests, it is accepted that you are not a resident of Australia for tax purposes.
The "Determination of residency status - leaving Australia" tool is also available on our website to assist taxpayers to determine whether they are an Australian resident for tax purposes.