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Edited version of your private ruling
Authorisation Number: 1012522683096
Ruling
Subject: Residency
Question and answer
Are you a resident of Australia for tax purposes?
Yes.
This ruling applies for the following periods:
Year ending 30 June 2013,
Year ending 30 June 2014.
The scheme commenced on:
1 July 2012.
Relevant facts and circumstances
This ruling is based on the facts stated in the description of the scheme that is set out below. If your circumstances are materially different from these facts, this ruling has no effect and you cannot rely on it. The fact sheet has more information about relying on your private ruling.
You are an Australian citizen.
You are working for an Australian Government Department in an overseas country for a period of one year.
You will return to Australia at the end of your one year contract in the overseas country.
Your family remain living in Australia.
During your one year contract you return to Australia regularly to visit your family.
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 detail in Taxation Ruling IT 2650 Income Tax: Residency - permanent place of abode outside Australia. In examining these tests, IT 2650 provides a number of factors which assist in assessing a taxpayer's situation against the tests. A copy of this ruling is available from www.ato.gov.au.
The resides test
Whether the individual resides in Australia according to the ordinary meaning of the word resides.
In your case, you are working in an overseas country on a one year contract. Your family still live in Australia and you are returning regularly to Australia to visit them.
Although you have economic ties to the overseas country by way of your employment, your ties to Australia are stronger, as your family remains in Australia, and you return to Australia regularly when you are not working. You are also intending on returning to Australia at the end of your one year contract.
Based on these facts, you are residing in Australia according to the ordinary meaning of the word. Therefore, you meet the 'resides test' and are a resident of Australia for tax purposes.
The domicile test
Under this test, a person is a resident of Australia for tax purposes if their domicile is in Australia. Domicile is the place that is considered by law to be your permanent home. It is usually something more than a place of residence.
In your case the Commissioner is not satisfied that you have a permanent place of abode outside of Australia because:
· Your family remain in Australia
· You visit your family in Australia regularly
· You are intending to return to Australia at the end of your one year contract
Therefore, you are a resident of Australia under this test.
Your residency status
As you meet the resides and domicile tests, you are considered to be a resident of Australia for tax purposes.