Edited version of private advice

Authorisation Number: 1051574165028

Date of advice: 3 October 2019

Ruling

Subject: Residency

Question

Are you an Australian resident for income tax purposes for the period January 20XX to June 20XX?

Answer

No. Given regard to your circumstances as a whole and a consideration of the residency tests, it is accepted that you are not a resident of Australia for income tax purposes. Further information on residency can be found by searching 'QC 33232' on ato.gov.au

This ruling applies for the following periods:

Year ended 30 June 2018.

Year ended 30 June 2019.

Year ended 30 June 2020.

Year ended 30 June 2021.

The scheme commences on:

1 July 2017.

Relevant facts and circumstances

In 19XX you and your spouse, who were both citizens of Country A, moved to Australia.

You and your spouse were both granted citizenship of Australia.

You and your spouse have two adult non-dependent children.

You lived with your spouse in the family home.

You worked as a Professor at a local university in Australia.

The university offered you a three year secondment with a State Government of Country B (with the option to extend the assignment for a further period).

In your role in Country B, you will be working to help them to transition their economy to a digital economy.

You obtained a three year work permit visa which allows you to work and reside in Country B.

On XX January 20XX you departed Australia for Country B to commence your three year secondment.

You took all your personal belongings to Country B including:

·        Clothes

·        Books

·        Glasses

·        Medication

·        Bedding

·        Golf clubs

·        Computers

·        Mobile phones

·        Electrical kitchen equipment, and

·        Work related material.

Your spouse did not accompany you to Country B.

Your spouse previously worked for a university in Australia.

On XX October 20XX your spouse started a three year role with the National University in Country A.

Your spouse secured a long term 12 month lease over accommodation in Country A. The lease is intended for annual renewal in accordance with local protocols.

You continue to be paid your ordinary salary through the local Australian university's payroll into your Australian bank account for your employment services performed in Country B.

The local university in Australia is reimbursed these costs by the State Government in Country B.

You continue to accrue annual leave in line with Australian standards.

You continue to accrue long service leave while working in Country B.

The annual incentive bonus is paid through Country B's payroll into your Country B bank account.

You use your Country B bank account for day to day use.

You do not qualify to participate in Country B's pension scheme so you have made the decision to maintain Australian superannuation contributions.

Neither you nor your spouse are members of the Commonwealth Superannuation Scheme (CSS) or Public Sector Superannuation Scheme (PSS).

Your employer has provided you with a long term residential apartment in Country B. It has a fully equipped kitchen. The lease is intended for annual renewal in accordance with local protocols.

You have also been provided with a vehicle with driver supplied, a new mobile phone, private health cover and group insurance.

You have built a group of friends where you undertake social activities which comprise of regular social outings and dinner at local restaurants.

You joined the local Golf Club.

You have obtained a tax file number and lodge tax returns in Country B.

You have access to health care in Country B and will make regular use of these facilities when required, including general practitioners and dentists.

The family home in Australia is unencumbered.

The family home remains empty, and is used occasionally by one of your adult children, and by your spouse on their return visits back to Australia.

You are reluctant to sell the family home at this time given the fall in the Australian property market.

You only return to Australia three or four times a year for no more than one to two weeks at a time depending on the leave you can obtain. You take this opportunity to visit other family and friends.

You and your spouse have both visited Australia at the same time; however upon your return to Country A and Country B you re-establish your independent living arrangements.

Your spouse and adult children have also taken the opportunity to visit you in Country B.

You advised:

·        The Australian Electoral Office to remove your name from the Australian electoral roll, and

·        Your Australian banks you are no longer a tax resident of Australia and that non-resident withholding tax will apply to your interest income payments.

You have diverted all mail to your address in Country B. However, the majority of your correspondence is electronic which you receive in Country B.

You still hold a number of Australian bank accounts, you are a shareholder of Australian listed companies and you have an Australian superannuation fund.

You and your spouse will likely return to Australia to spend your retirement, however, this is not something you have turned your attention to at present.

Relevant legislative provisions

Income Tax Assessment Act 1936 sub-section 6(1)

Income Tax Assessment Act 1997 sub-section 995-1(1)