Edited version of private advice

Authorisation Number: 1052110708491

Date of advice: 21 April 2023

Ruling

Subject: Residency

Question

Were you a resident of Australia for taxation 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 commenced on:

1 July 20XX

Relevant facts and circumstances

You were born in Country Y.

You are a citizen of Country Y.

You are not a permanent resident of any other country.

You left Australia on XX XXXX 20XX to go to Country Z.

Prior to moving to Country Z you lived in Australia.

You were working in Australia prior to leaving.

You entered Country Z on a tourist visa for the first 3 months and then you obtained a work visa.

You were in a number of short- term relationships in Country Z.

You did not live with any of your partners in Country Z.

You lived in a rented apartment which was shared with 2 other people who you did not know prior to living with them.

You had your own bedroom in the apartment and shared the rest of the apartment.

You paid for this apartment and was not reimbursed by your employer.

You had established social groups and friendships in Country Z.

You had a number of jobs in Country Z.

You came back to Australia in 20XX for 3 weeks to visit your parents.

You are not eligible to contribute to the PSS or the CSS super funds.

Relevant legislative provisions

Income Tax Assessment Act 1936 Subsection 6(1)

Reasons for decision

For tax purposes, whether you are a resident of Australia is defined by subsection 6(1) of the Income Tax Assessment Act 1936 (ITAA 1936).

The definition has four tests to determine your residency for income tax purposes. These tests are:

•         the resides test

•         the domicile test

•         the 183- day test, and

•         the Commonwealth superannuation fund test.

It is sufficient for you to be a resident under one of these tests to be a resident for tax purposes.

Our interpretation of the law in respect of residency is set out in Taxation Ruling TR 2022/D2 Income tax: residency tests for individuals.

The resides test

The resides test is the primary test of tax residency for an individual. If you reside in Australia according to the ordinary meaning of the word resides, you are considered an Australian resident for tax purposes.

Some of the factors that can be used to determine whether you reside in Australia include:

•         period of physical presence in Australia

•         intention or purpose of presence

•         behaviour while in Australia

•         family and business/employment ties

•         maintenance and location of assets

•         social and living arrangements.

No single factor is decisive, and the weight given to each factor depends on your specific circumstances.

Where an individual does not reside in Australia according to ordinary concepts, they will still be an Australian resident if they meet the conditions of one of the other tests.

The domicile test

Under the domicile test, if your domicile is in Australia, you are a resident of Australia unless the Commissioner is satisfied that your permanent place of abode is outside Australia.

Whether your domicile is Australia is determined by the Domicile Act 1982 and the common law rules on domicile.

For example, you may have a domicile by origin (where you were born) or by choice (where you have changed your home with the intent of making it permanent).

Whether your permanent place of abode is outside Australia is a question of fact to be determined in light of all the facts and circumstances of each case.

Key considerations in determining whether you have your permanent place of abode outside Australia are:

•         whether you have definitely abandoned, in a permanent way, living in Australia

•         length of overseas stay

•         nature of accommodation, and

•         durability of association.

The 183-day test

Under the 183- day test, if you are present in Australia for 183 days or more during the income year, you will be a resident, unless the Commissioner is satisfied that both:

•         your usual place of abode is outside Australia, and

•         you do not intend to take up residence in Australia.

The question of usual place of abode is a question of fact and generally means the abode customarily or commonly used by you when are physically in a country.

The Commonwealth superannuation test

An individual is a resident of Australia if they are either a member of the superannuation scheme established by deed under the Superannuation Act 1990 or an eligible employee for the purposes of the Superannuation Act 1976, or they are the spouse, or the child under 16 of such a person.

Application to your circumstances

We have considered each of the statutory tests listed above in relation to your particular facts and circumstances. We conclude that, for the relevant income years you were not a resident of Australia as follows.

Taking into account your individual circumstances, we have concluded that you were not a resident of Australia according to ordinary concepts.

We also consider that your domicile is not in Australia and the Commissioner is satisfied that your permanent place of abode was outside Australia.

We considered the following factors in forming our conclusion:

•         You left Australia on XXXX to go to Country Z to work.

•         You were in Country Z for more than 5 years.

You only returned once for a short trip back to Australia to see your family in the time you were in Country Z.

You had a work visa to remain in Country Z.

You had long term accommodation in Country Z.

You were not in Australia for more than 183 days for the relevant period.

You do not fulfil the requirements of the Commonwealth Superannuation test and are therefore not a resident under this test.

You were not a resident of Australia for taxation purposes for the 20XX, 20XX, 20XX, 20XX, 20XX and 20XX income years.