Edited version of your written advice

Authorisation Number: 1051379104649

Date of advice: 29 May 2018

Ruling

Subject: Residency

Question

Are you a resident of Australia for income tax purposes?

Answer

Yes

This ruling applies for the following periods:

Year ended 30 June 20XX

Ear ending 30 June 20XX

The scheme commenced on:

1 July 20XX

Relevant facts and circumstances

You were born in Country A and are a citizen of that Country.

You were offered employment in Australia which involved working in different cities of Australia.

Upon arriving in Australia you were granted a Temporary working Visa which allowed you to work and live in Australia for a maximum period of two years.

You arrived in Australia late in 20XX with the intention of staying in Australia for the duration of your working contract, which was scheduled to finish in late 20XX.

The sole purpose of your visit to Australia was for work purposes.

You visited your home country for a couple of weeks upon the conclusion of the working period in each Australian city, before arriving back in Australia to commence work in the new city.

You initially arrived in one city of Australia where you stayed in employer supplied accommodation until the middle of 20XX, when you were required to move to another city of Australia to fulfil your working obligations with your Australian employer.

Whilst in that city you also stayed in employer supplied accommodation until the start of 20XX, when you were required to move to another city of Australia to fulfil your working obligations.

Whilst in that city you decided to rent and share private accommodation with another employee until the middle of 20XX, when your employment contract was terminated early.

You have no spouse or dependants that have remained in Country A.

Upon the termination of your employment contract in the middle of 20XX, you departed Australia permanently and returned to Country A.

Relevant legislative provisions

Income Tax Assessment Act 1997 Subsection 995-1(1).

Income Tax Assessment Act 1936 Subsection 6(1).

Income Tax Assessment Act 1997 Subsection 6-5(2).

Reasons for decision

Residency

Section 995-1 of the Income tax Assessment Act 1997 (ITAA 1997) defines an Australian resident for tax purposes as a person who is a resident of Australia for the purposes 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. The tests are:

● the resides test,

● the domicile (and permanent place of abode) test,

● the 183 day test, and

● the superannuation test.

An individual need only satisfy the conditions of one of the four tests to be deemed a resident of Australia for income tax purposes.

The resides test

The resides test considers whether an individual is residing in Australia according to the ordinary meaning of the word ‘reside’. As the word ‘reside’ is not defined in Australian taxation law, it takes its ordinary meaning for the purposes of subsection 6(1) of the ITAA 1936.

The ordinary meaning of the word 'reside', according to the Macquarie Dictionary, 2001, rev. 3rd edition, is 'to dwell permanently or for a considerable time; having one's abode for a time', and according to the Compact Edition of the Oxford English Dictionary (1987), is 'to dwell permanently, or for a considerable time, to have one's settled or usual abode, to live in or at a particular place'.

In your case:

● you arrived in Australia on a temporary working visa late in 20XX.

● the sole purpose of your visit to Australia was for work purposes.

● your employment involved working in different cities of Australia.

● When working in the first two cities of Australia you remained living in the one place in each city for more than six months.

● When working in next city of Australia you remained living in the one place for the entire length of your employment whilst you were in that city, which was just over four months. You would have remained living in the same place in that city for more than six months had your employment contract not finished earlier than expected.

● You have no spouse or dependants that have remained in Country A.

Based on the facts of your case, you are residing in Australia according to the ordinary meaning of the word. Therefore you are a resident of Australia under this test.

Your residency status

In view of the above, the Commissioner considers that your behaviour in Australia reflects a degree of continuity, routine and habit that is consistent with residing here.

As you meet the resides test, you are a resident of Australia for income tax purposes under subsection 6(1) of the ITAA 1936.