Edited version of private advice

Authorisation Number: 1051895986963

Date of advice: 29 April 2022

Ruling

Subject: Residency

Question

Is the taxpayer considered a non-resident of Australia for the purposes of section 6(1) of the Income Tax Assessment Act 1936 (ITAA 1936) form the time they left Australia?

Answer

Yes, having considered your circumstances as a whole and the residency tests, it is accepted that you are not a resident of Australia for income tax purposes.

This ruling applies for the following periods:

Year ending 30 June 20XX

Year ended 30 June 20XX

The scheme commences on:

1 July 20XX

Relevant facts and circumstances

You are an Australian citizen.

You are married and have adult children.

You were employed by Company A.

You were offered and accepted the opportunity to take up a managerial position of Company B located in an overseas country.

You signed a 12-month lease on a family home in the overseas country.

The lease was in your personal name.

The 12-month lease on the new family home commenced a few months before your new role and utilities (including electricity and internet) were connected to the property in your name.

You visited the overseas country for a week.

Your employment contract with Company B states that the term of the contract is expected to be a minimum of 2 years, however, you expect to continue in the role for 4-5 years.

Your Australian employment with Company A has been terminated as you are now working for Company B overseas.

You moved overseas three months before your new role began to prepare.

It was originally intended that your spouse would join you overseas permanently early in the following year.

You and your spouse packed up your personal belongings in Australia and made arrangements for these to be shipped overseas.

Your belongings included crockery, cutlery, linen, clothes, Christmas decorations, books, and photographs cleared customs early in the new year.

Before your spouse could relocate overseas, your in-law had a significant medical event.

Your spouse had been visiting you overseas at the time and had been unpacking belongings in preparation for their permanent move when they received the information.

Your spouse had to cut short their visit following news of their parent significant medical event and they immediately returned to Australia to care for their parent.

You also returned to Australia for 3 weeks over Christmas and New Year to support your spouse during this challenging time.

This family emergency meant that you spent longer in Australia during this period than you had initially intended.

Although your spouse had intended to move overseas early in the new year, their parent's significant medical event meant that they had to remain living predominantly in Australia until ongoing care for their parent could be arranged.

A few months into the new year you received news on of the pending passing of your father and were advised that you needed to return to Australia.

By this time, both the Australian and the overseas governments had implemented travel restrictions in response to the COVID-19 pandemic.

The Australian government granted you approval to return to Australia on compassionate grounds

You returned to Australia shortly before your father passed away.

You spent around 12 days in Australia on compassionate leave.

You attempted to return overseas.

Despite various attempts to return to overseas, you were unable to travel.

One month after the passing of your father you made an initial application to return overseas.

You received notification from the overseas Government that your request to return overseas under the COVID-19 travel ban exception process had been unsuccessful.

Despite this unsuccessful attempt at a return overseas, you, in association with your overseas immigration lawyer, continued to make a re-application for entry.

You reapplied for entry overseas.

The overseas Immigration assessed your request to return overseas and permission to travel was granted on the same date.

A short time later the Australian Department of Home Affairs exempted you from the travel restrictions placed on Australian Citizens and Permanent Residents from departing Australia.

You were cleared to depart Australia on the basis that you had an existing work contact overseas.

Approximately six months after you entered Australia you returned overseas on the next possible flight and you have since travelled to Australia on business trips as part of your role with Company B.

During the six months you were in Australia

You stayed at your main residence property which was closest to your father.

One of your family members was occupying the downstairs area of the property during this time and they continued to do so while you were there.

Your new home overseas continues to be maintained by you and available to you at any time.

You continued performing your overseas based role remotely from your main residence property.

Whilst working remotely, you worked standard overseas business hours and took overseas public holidays.

Your mail continued to be sent to your new home overseas.

Australian property

Before moving overseas, you and your wife owned a few properties in Australia:

You did not want to make your main residence available for rent due to the nature of the property and the value to them as a family home. The property is also occasionally used by the wider family including your children while you are away.

You and your spouse are members of a Self-Managed Superannuation Fund.

You continue to maintain some Australian bank accounts which are required to fund necessary expenses in Australia including for the investment properties.

Your spouse has maintained private health insurance in their name, which covers both of you

One of the rental properties was sold.

You made all your friends and business associates aware of your move overseas.

You retained two memberships in Australia for convenience.

You have remained on the Australian electoral roll for the moment.

You are not:

(a)     a member of the superannuation scheme established by deed under the Superannuation Act 1990; or

(b)     an eligible employee for the purposes of the Superannuation Act 1976; or the spouse, or a child under 16, of a person covered by sub-subparagraph (a) or (b).

You were not in Australia for 182 days or more in the 2020 and 2021 income years.

Overseas Property

You are employed overseas and are paid in overseas dollars from the overseas payroll.

Your overseas salary (which is your main source of income) is paid into your overseas bank account.

All of your children are adults and are financially independent therefore didn't need to relocate with you.

You signed a 12-month lease on a new family home overseas. This lease was subsequently renewed for a further six months.

Before the lease ended, another 12-month lease was signed for another property.

You had requested a 3-year lease on the property however the landlord was only willing to agree to two 1-year extensions on the property at that time.

You are responsible for payment of the expenses for your accommodation overseas.

You continued to fund these expenses (i.e., rent, electricity, internet and water) whilst you were stranded in Australia as a result of international border closures.

You obtained an overseas Driver's License.

You are on the overseas electoral roll.

You are a member of the overseas Institute of Directors.

Relevant legislative provisions

Income Tax Assessment Act 1936 section 6-1

Income Tax Assessment Act 1997 section 995-1