Question

Usman held a French passport at all relevant times. From 2012 until the end of the 2016-17 income year he had an Australian visa which permitted him to live and work here. During the time he was in Australia he worked as an engineer. For two months in 2015 he returned to France and worked there. At all times in the 2016-17 tax year he worked in Australia. For the 2016-17 tax year is Usman a resident or non-resident? To support the analysis in your answers refer where appropriate to the ITAA 1936, ITAA 1997, Tax Rulings and/or case law.

Answer 1

LETS ALAYSE THE USMANS RESIDENT STATUS By USING 2 Rules

1.Common Law Test

2.

Common law test An individual is considered to be an Australian tax resident if the individual “resides” in Australia according to the ordinary meaning of that word (subsection 6(1) of the Income Tax Assessment Act 1936 (ITAA 1936)). The ordinary concept of residency takes into account a person’s overall circumstances in the relevant income year, including:

? the intention or purpose of the individual’s presence in Australia; WORKING

? the extent of the individual’s family or business and employment ties within Australia; BUSINESS TIES

? the maintenance and location of the individual’s assets; NOT AVAILABLE

? the individual’s social and living arrangements. APPLICABLE

USMAN SATISFIES 2 conditions out of 4

Statutory tests

If an individual does not satisfy the common law test of residency, the individual is still considered to be an Australian tax resident if the individual satisfies one or more of three statutory residency tests in subsection 6(1) of the ITAA 1936:

? The person’s domicile is in Australia (unless their permanent place of abode is outside of Australia); Yes

? The person is actually in Australia for more than half of the financial year (unless their usual place of abode is outside Australia and they do not intend to take up residence in Australia); YES

? The person is (or is the spouse or child under 16 of) a contributing member of a superannuation fund for Commonwealth government officers. It is also possible for an individual to fall within the special No

USMAN SATISFIE 2 OUT OF 3 CONDITIONS

BY ABOVE INFORMATION WE CAN CONCLUED THAT USMAN IS A RESIDENT OF AUSTRALIA