Assessable income

Non-binding edited private advice. This is an edited version of private advice the ATO gave to a specific taxpayer about their own circumstances. You cannot rely on it — it is not binding and provides no protection for anyone else (see PS LA 2008/4). Use it as a guide to the ATO’s thinking, not as authority.

1 Is your employment income from overseas assessable in Australia?

1 Yes. Question 2 Are you entitled to claim a Foreign Income Tax Offset (FITO) for the tax paid on the overseas income in Australia? Answer 2 No. This ruling applies for the following period : Year ended 30 June 20XX The scheme commenced on: 1 July 20XX

You are a temporary resident of Australia. You enter Australia on a temporary visa. You were resident of Australia for taxation purposes for the relevant income year. You work for your overseas employer in the relevant income year.

Income Tax Assessment Act 1997 Subdivision 768-R

Subdivision 768-R of the Income Tax Assessment Act 1997 (ITAA 1997) provides that where you are a resident of Australia for taxation purposes and meet the requirements to be a temporary resident of Australia you will be subject to the following temporary resident rules: • Any income you earn from an overseas source will not be taxed in Australia except income earned from overseas employment performed while you are a temporary resident. • Any capital gain you make from a capital gains tax event that relates to an asset that is not taxable Australian property will not be taxed in Australia. • Special rules apply to capital gains on shares and rights acquired under employee share schemes. Your income derived from your employment overseas will be assessable in Australia and required to be declared in your Australian tax return. You are not able to claim a FITO in Australia on the tax paid overseas as Australia has the primary taxing rights on the income. You will need to approach the overseas tax authorities regarding any FITO.