Are you an Australian tax resident?

Many clients often make the mistake of assuming that they have ‘lost’ Australian tax residency simply by moving overseas and becoming a resident of the other jurisdiction. 

Unfortunately, although a person may live in a foreign country and pay local tax in that country, it is possible that they may still be considered an Australian resident for tax purposes.  This is because Australian tax law recognises that an individual can be a resident of more than one country at the same time.

In order to be a non-resident for Australian tax purposes, you need to ensure that you do not satisfy any of the tests listed above. 

While it is easy to determine whether a person has physically been in Australia for more than 183 days of the year or is a member of certain superannuation schemes, it may be difficult to determine whether an individual actually ‘resides’ or has a domicile in Australia as the legislative definition of ‘reside’ is not well defined and the domicile rules can be complex.

We have outlined below some of the common mistakes that are made which may indicate that an individual actually ‘resides’ or has a domicile in Australia:

We note that the while the above sets out some key indicias of the maintenance of Australian tax residency, they do not absolutely indicate that an individual has retained his or her Australian tax residency when one of these items apply to them. 

With all residency issues, it is always important to examine an individual’s circumstances on a case by case basis before coming to a conclusion.  As the concept of residency is integral when determining an individual’s tax circumstances, it is important that an individual seek the necessary advice to confirm this prior to undertaking major transactions.

This information has been prepared in good faith, is in the nature of general comment only, and neither purports, nor is intended, to be advice on any particular matter.  You should not act or rely upon any matter or information contained in or implied without taking appropriate professional advice which relates specifically to your particular circumstances.  The authors and consultants expressly disclaim all and any liability to any person (whether a reader or not) who acts or fails to act as a consequence of reliance upon the whole or any part of this information.