Residency

Are you a resident of Australia for tax purposes from 1 July 20YY to 30 June 20YY?

Yes. This ruling applies for the following periods : •               Year ended 30 June 20YY •               Year ending 30 June 20YY •               Year ending 30 June 20YY •               Year ending 30 June 20YY The scheme commenced on: 1 July 20XX

You were born in XX, and your parents are XX. You moved to Australia when you were xx years of age and granted Australian citizenship at that time. You are xx years of age. On DD MM 20YY you commenced working full time for a foreign company in Country A. Your contract with the company is for xx years, ending on DD MM 20YY. Your employment offer was the primary motivation for relocation to Country A. You travelled to Country A on DD MM 202YY. On DD MM 20YY you were granted an annual residence permit, sponsored and renewed annually by your employer for the duration of your employment. You lease an apartment in Country A on a renewable lease. The rent is your own expense. You purchased furniture, bedding and domestic appliances for the apartment. You own a residence in Australia with your spouse. Your spouse remains living in Australia. Your spouse does not wish to relocate to Country A as they are providing support for an aged parent, and they find it difficult to reconcile with the cultural and legal environment in Country A. You have xx adult children who reside independently in Australia.

You visit your family in Australia and mark your passenger card as 'visitor or temporary resident'. You travelled to Australia to visit family for the following periods: •               DD MM 20YY to DD MM 20YY - 15 days •               DD MM 20YY to DD MM 20YY - 7 days •               DD MM 20YY to DD MM 20YY - 18 days •               DD MM 20YY to DD MM 20YY - 19 days Your spouse travels to Country A on occasion for holidays. You and your spouse have travelled to the other countries for holidays: •               between DD MM 20YY to DD MM 20YY- xx days •               between DD MM 20YY to DD MM 20YY- xx days You have also travelled to other countries for short holidays of not more than xx days at a time between DD MM 20YY to DD MM 20YY. You have not spent more than 183 days in Australia in the 20YY or 20YY income years. You plan to visit Australia one or twice a year, for a couple of weeks at a time. Your employer reimburses you for one annual return airfare for travel from Country A to Australia. You stay at the family home when in Australia. You financially support your spouse and transfer funds to an Australian bank account jointly held with your spouse.

You hold driver's licences in both Australia and Country A. You do not own a motor vehicle, nor have any registered in your name. You have requested cancellation of your Medicare. You have cancelled your private health insurance. You have removed your name from the Australian Electoral Roll. You have registered postal account in Country A. You retain Australian bank accounts. You have advised one of your Australian bank accounts that you are a foreign resident. You hold and Australian superannuation fund. You have a bank account in Country A. You have a gym membership in Country A. You intend to remain in Country A for the duration of your employment contract. You intend to return to Australia once your contract of employment expires in MM 20YY, or longer if your contract of employment extends beyond this date.

Income Tax Assessment Act 1936 subsection 6(1) Income Tax Assessment Act 1997 section 995-1

Section 995-1 of the Income Tax Assessment Act 1997 (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', as applied to an individual, are defined in subsection 6(1) of the ITAA 1936. The definition offers four tests to ascertain whether each individual taxpayer is a resident of Australia for income tax purposes. These tests are: •               the resides test (also referred to as the ordinary concepts test) •               the domicile test •               the 183-day test, and •               the Commonwealth superannuation fund test. The resides test is the primary test for deciding the residency status of an individual. This test considers whether an individual resides in Australia according to the ordinary meaning of the word 'resides'. 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, 183-day test and Commonwealth superannuation fund test).

Our interpretation of the law in respect of residency is set out in Taxation Ruling TR 2023/1 Income tax: residency tests for individuals . We have considered the statutory tests listed above in relation to your situation as follows: The resides test The ordinary meaning of the word 'reside' has been expressed as 'to dwell permanently or for a considerable time, to have one's settled or usual abode, to live, in or at a particular place': See Commissioner of Taxation v Miller (1946) 73 CLR 93 at 99 per Latham CJ, citing Viscount Cave LC in Levene v Inland Revenue Commissioners [1928] AC 217 at 222, citing the Oxford English Dictionary. Likewise, the Macquarie Dictionary defines 'reside' as 'to dwell permanently or for a considerable time; have one's abode for a time'. The Commissioner considers the following factors in relation to whether a taxpayer is a resident under the 'resides' test: •               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. It is important to note that no one single factor is decisive, and the weight given to each factor depends on each individual's circumstances. Because the resides test is about whether an individual resides in Australia, the factors focus on the individual's connection to Australia. Having a connection with another country, or being a resident of another country, does not diminish any connection to Australia. The ordinary meaning of reside does not require an individual to have a principle or usual place of residence in Australia. Application to your situation You are not a resident of Australia under the resides test for the period 1 July 20YY to 30 June 20YY based on the following: •               you departed in Australia to live and work in Country A •               you have a full-time employment contract in Country A •               you intend to work and reside in Country A for the period of your employment contract •               you have long term rental accommodation in Country A •               you have not maintained any professional or occupational membership in Australia

•               you have a gym membership in Country A •               you have visited family in Australia for short holiday periods since departing Australia •               you retain a jointly owned home in Australia with your spouse •               your spouse and adult children reside in Australia •               you have taken steps to relinquish association with Australia as you have; advised Medicare of your departure, cancelled your private health insurance, advised the Australian Electoral Commission to remove you from the electoral roll, and notified one of your Australian financial institutions that you are a foreign resident •               you maintain bank accounts in Australia •               you have a bank account in Country A •               you have obtained a driver's licence in Country A Based on the information you have provided, you are not a resident of Australia under the resides test for the 20YY, 20YY, 20YY, 20YY and 20YY income years. You may still be an Australian resident if you meet the conditions of one of the other tests (the domicile test, the 183-day test or the Commonwealth superannuation fund test). Domicile test

Under the domicile test, you are a resident of Australia if your domicile is in Australia unless the Commissioner is satisfied that your permanent place of abode is outside Australia. Domicile Whether your domicile is in Australia is determined by the Domicile Act 1982 and the common law rules on domicile. Your domicile is your domicile of origin (usually the domicile of your father at the time of your birth) unless you have a domicile of dependence or have acquired a domicile of choice elsewhere. To acquire a domicile of choice of a particular country you must be lawfully present there and hold the positive intention to make that country your home indefinitely. Your domicile continues until you acquire a different domicile. Whether your domicile has changed depends on an objective consideration of all relevant facts. Application to your situation In your case, you were born in overseas to foreign parents. You are not cognisant of your citizenship status. You obtained citizenship in Australia when you were an adolescent. It is considered that you have abandoned your domicile of origin and acquired a domicile of choice in Australia.

It is also considered that you have not abandoned your Australian domicile and acquired a domicile of choice in Country A. You are not entitled to reside in Country A indefinitely as while living in Country A you only hold a residency permit which must be renewed annually and is subject to your continued employment. Your current residency permit is valid until MM 20YY. You have not applied for permanent residency in Country A. Therefore, your domicile is Australia. Permanent place of abode If you have an Australian domicile, you are an Australian resident unless the Commissioner is satisfied that your permanent place of abode is outside Australia. This is a question of fact to be determined in light of all the facts and circumstances of each case. 'Permanent' does not mean everlasting or forever, but it is to be distinguished from temporary or transitory. The phrase 'permanent place of abode' calls for a consideration of the physical surroundings in which you live, extending to a town or country. It does not extend to more than one country, or a region of the world. The Full Federal Court in Harding v Commissioner of Taxation

[2019] FCAFC 29 held at paragraphs 36 and 40 that key considerations in determining whether a taxpayer has their permanent place of abode outside Australia are: •               whether the taxpayer has definitely abandoned, in a permanent way, living in Australia •               whether the taxpayer is living in a town, city, region or country in a permanent way. The Commissioner considers the following factors relevant to whether a taxpayer's permanent place of abode is outside Australia: •               the intended and actual length of the taxpayer's stay in the overseas country •               whether the taxpayer intended to stay in the overseas country only temporarily and then to move on to another country or to return to Australia at some definite point in time •               whether the taxpayer has established a home (in the sense of dwelling place; a house or other shelter that is the fixed residence of a person, a family, or a household), outside Australia •               whether any residence or place of abode exists in Australia or has been abandoned because of the overseas absence

•               the duration and continuity of the taxpayer's presence in the overseas country •               the durability of association that the person has with a particular place in Australia, i.e. maintaining assets in Australia, informing government departments such as the Department of Social Security that he or she is leaving permanently and that family allowance payments should be stopped, place of education of the taxpayer's children, family ties and so on. As with the factors under the resides test, no one single factor is decisive, and the weight given to each factor depends on the individual circumstances. Application to your situation The Commissioner is not satisfied that your permanent place of abode is outside of Australia because: •               your purpose is to live and work in Country A for the period of your employment contract •               you are undecided about your plans beyond the end of your employment contract •               you have rental accommodation in Country A

•               you own a permanent residence in Australia with your spouse that is your family home. Your spouse continues to live in the property, and you stay there when visiting Australia •               you have not disposed of your ownership interest in the property to any other party •               you financially support your spouse in Australia •               you remain married to your spouse in Australia who has chosen to remain in Australia due to family responsibilities and personal preference regarding lifestyle. It is considered that you have not definitely abandoned, in a permanent way, living in Australia. Therefore, you are a resident of Australia under the domicile test. 183-day test Where a person is present in Australia for 183 days or more during the year of income the person will be a resident, unless the Commissioner is satisfied that both: •               the person's usual place of abode is outside Australia, and •               the person does not intend to take up residence in Australia. Application to your situation

You will not be present in Australia for 183 days or more in the period of review. Therefore, you will not be a resident under this test for these income years. 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. You are not a member on behalf of whom contributions are being made to the Public Sector Superannuation Scheme (PSS) or the Commonwealth Superannuation Scheme (CSS) or a spouse of such a person, or a child under 16 of such a person. Therefore, you are not a resident under this test. Conclusion You satisfy the domicile test of residency and so are a resident of Australia for income tax purposes for the years ended 30 June 20YY to 30 June 20YY.