Question

Sheridan finished her degree at the end of 2018 and left Australia for a working holiday. At the time of her departure she did not know when she would return. She worked in Paris for 3 months, travelled around Europe for 6 months before returning to Paris to work for another 3 months. She then travelled to Brazil where she intended to work for 12 months. During the time in Brazil, Sheridan became ill and had to come back to Australia after only 6 months. While overseas she rented rooms in share houses while working and youth hostels while travelling.

Required: With reference to relevant legislation, case law, and/or ATO Rulings, advise Sheridan on her residence status for tax purposes. Why is this important?

Answer 1

Primary condition under section 6(1) :

An individual is said to be resident in India any previous year if he satisfied at least one of the basic condition

(I) He is in India for at least 182 days in the previous year

(II) He is india for at least 60 days in the previous year and for 365 days or more during 4 years immediately preceding the previous year.

Exception:

When an Indian citizen leaves India during the previous year for employment or business outside India.

In the present case Sheridan complete the degree in 2018 and go to the Australia and worked in Paris and Europe. Sheridan fullfil the primary condition i.e the exceptional case leaves the Indian during the previous year for employment

Therefore Sheridan is a resident and ordinarily resident for the Assessment year 2020-21