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Edited version of private advice
Authorisation Number: 1052358392835
Date of advice: 5 February 2025
Ruling
Subject: Double tax agreement
Question 1
Is your income from Company X assessable income in Australia under section 6-5 of the Income Tax Assessment Act 1997 (ITAA 1997)?
Answer 1
No.
Taxation Ruling TR 2005/8 Income tax: the meaning of particular terms in the Government Service Articles of Australia's tax treaties states that for most tax treaties, the term 'in the discharge of governmental functions' is to be read broadly to include any function that the relevant government chooses to undertake. As Company X is a XXX XXX established, funded and controlled by the government of Country Y, Article 19 (Government service) of the Agreement between the Government of Australia and the Government of the Country Y for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with respect to Taxes on Income (the Agreement) is relevant in your case.
You are a citizen only of Country Y and you resided in Australia on a visa sponsored by Company X solely for the purpose of performing your employment duties for Company X. As such, Article 19 of the Agreement provides that employment income will be taxable only in Country Y.
This ruling applies for the following periods:
Year ended XX 20XX
Year ending XX 20XX
The scheme commenced on:
XX 20XX
Relevant facts and circumstances
You were born in Country Y and you are citizen of Country Y. You are not a citizen of any other country.
You are employed with Company X. Company X is a XXX XXX established, funded and controlled by the government of Country Y.
Company X established a office in Australia and you were allocated to work in Australia.
Your employment contract in Australia was from XX 20XX to XX 20XX.
On XX 20XX, you and your family arrived in Australia under a visa sponsored by company X.
You returned to Country Y upon the end of the contract.
You were Australian resident for taxation purposes during your period in Australia.
Relevant legislative provisions
Income Tax Assessment Act 1997 section 6-5
International Tax Agreements Act 1953 section 4