Tax Return:: Are You an Australian Resident for Tax Purposes?

Hello, this is your tax and super specialist, P&C Tax Professionals.

I’m sure many of us are aware that we must all lodge our tax return here in Australia for each financial year if you:

(1) Are an Australian Resident

(2) Have become an Australian resident during the financial year

(3) Are a foreign resident who has generated Australian sourced assessable income.

But how do we know if we are an Australian resident for tax purposes or a foreign resident for tax purposes? We will seek to answer this question in this blog post.

What makes you an Australian resident for tax purposes?

As a general rule of thumb, you would be considered an Australian resident for tax purposes if the following applies to you:

> You have always been living in Australia or have moved to Australia and are living in the country permanently.

> You have been residing in Australia continuously for 6 months or beyond and for the majority of your time in Australia, you have worked in a single job and have lived at the same residential address.

> You were physically present in Australia for greater than 6 months during the financial year. On the other hand, if your usual place of abode is located overseas and you have no intentions to live permanently in Australia, you will be classified as a foreign resident for tax purposes.

> You have temporarily travelled overseas and you do not have a permanent home outside of Australia.

> You are an international student who has moved to Australia to study and are enrolled in a course that lasts for more than 6 months.

If the above sounds like you, there is a high chance that you will be considered an Australia resident for tax purposes.

Updates on Tax Residency as a Result of COVID-19

If you are a foreign resident in Australia temporarily for a few weeks or even a few months as a result of COVID-19, in this case, you will NOT be considered an Australian resident for tax purposes if:

(1) Your usual place of abode is overseas and you live there on a permanent basis.

(2) You have intentions to return to your overseas home as soon as you are capable of moving back.

However, please note that you would have to reconsider your residency status if any of the following circumstances relate to you:

(1) Due to COVID-19, you have ended up staying in Australia for an extended period of time

(2) You have no plans on returning to your country of residency, even if you are capable of moving back.

Well, that’s all for now but as always if you have any further questions, please send us an email at pnctax@naver.com or kindly direct your questions to our Official Facebook Page (P&C Tax Professionals – Australia).

Thank you!