This case looked at whether the taxpayer should be treated as a resident of Australia for tax purposes and focused on the ‘ordinarily resides’ test and ‘domicile’ test of residency. The Federal Court held that the taxpayer had an Australian domicile and had not established a permanent place of abode overseas, which meant that they were treated as a resident of Australia even though they no longer resided in Australia under general principles.
In this case, the taxpayer departed Australia in 2009 to work in the Middle East, having previously lived there for a significant period before relocating to Australia. It was accepted that he had no intention of returning to Australia to live. However, the taxpayer did retain ownership of his residence in Australia (primarily for the use of his wife and children) and returned to Australia each year to visit his family. While in the Middle East the taxpayer stayed in several serviced apartments which he claimed became his home.
The court looked at whether the taxpayer could be treated as a resident of Australia under the resides test, which looks at whether someone resides in Australia under ordinary concepts. Despite the existence of several factors which suggested that the taxpayer retained a “continuity of association” with Australia, the Court was satisfied that he did not reside in Australia. The evidence suggested that the taxpayer prioritised his occupation and showed a resolute intention to stay overseas despite his family circumstances. It was concluded that the taxpayer had formed the necessary intention to cease residency in Australia.
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