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Edited version of private advice
Authorisation Number: 1051581533438
Date of advice: 19 September 2019
Ruling
Subject: International residency - locally employed staff
Question
Are you a resident of Australia for income tax purposes?
Answer
No
This ruling applies for the following periods:
Year ended 30 June 20XX
Year ended 30 June 20XX
Year ended 30 June 20XX
Year ended 30 June 20XX
Year ended 30 June 20XX
Year ended 30 June 20XX
The scheme commences on:
26 November 20XX
Relevant facts and circumstances
You are a citizen of Australia.
You are a locally engaged staff member an Australian Embassy
You departed Australia.
From a date you have held a permanent employment contract at the Embassy.
You hold long stay visas and work permits.
You have submitted an application for long-term residency for another country.
You rent accommodation in the relevant city.
You were accompanied by your partner.
You have returned to Australia on several occasions to visit family and friends, these trips were of a short duration.
You did not exceed 183 days presence in Australia for any relevant financial year of the ruling.
You are not eligible to contribute to PSS or the CSS Commonwealth superannuation funds.
Relevant legislative provisions
Income Tax Assessment Act 1936 Subsection 6(1)
Income Tax Assessment Act 1997 Section 6-5
Income Tax Assessment Act 1997 Subsection 6-5(3)
Income Tax Assessment Act 1997 Subsection 995-1(1)
Reasons for decision
Section 6-5 of the Income Tax Assessment Act 1997 (ITAA 1997) provides that 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.
Section 995-1 of the 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 test,
· the 183 day test, and
· the superannuation test.
If any one of these tests is met, an individual will be a resident of Australia for taxation purposes.
Based on the facts you have provided, we can conclude that you will not satisfy any of the tests of residency.
Accordingly you are not a resident of Australia for income tax purposes under section 995-1(1) of the ITAA 1997 and subsection 6(1) of the ITAA 1936.