Worked overseas, but still an Australian resident, says Tribunal
The AAT has recently heard two cases relating to whether the individual taxpayers involved, men who worked in the oil and gas industry in the Middle East, were Australian residents for tax purposes. These cases are considered in turn below.
No permanent place of abode outside of Australia
In one decision, the AAT found that a taxpayer was an Australian resident as he did not have a permanent place of abode outside of Australia for part of the 2009 income year (between 21 November 2008 and 30 June 2009). Accordingly, it found that the foreign sourced income derived by the taxpayer was assessable income for the relevant period.
The taxpayer worked as a technician in the oil and gas industry and on 21 November 2008 left Australia to take up employment in Oman. While in Oman, he resided in a single-room apartment provided by the company, which was shared with another employee with a complementary roster. The Commissioner audited the taxpayer and issued an amended assessment for the 2009 year to include the foreign sourced income from Oman on the basis that the taxpayer's permanent place of abode was in Australia. The taxpayer argued that his permanent place of abode was in Oman.
The AAT found that the taxpayer could not be described as having a permanent base in Oman since it was shared accommodation provided by the company that he had no legal interest in. Further, the AAT noted that the taxpayer had all his mail sent to Australia, had only basic possessions in Oman (ie clothes and a laptop) and left Oman as soon as practicable after the completion of each roster. The AAT said the taxpayer therefore did not have a permanent place of abode outside of Australia as he had no apparent ties to Oman beyond his employment. In conclusion, the AAT found that the taxpayer was an Australian resident for the relevant period and affirmed the Commissioner's decision.
Re Boer and FCT [2012] AATA 574, www.austlii.edu.au/au/cases/cth/AATA/2012/574.html
Australian resident according to ordinary concepts
In the other decision, the AAT found on the balance of facts that a taxpayer was an Australian resident according to ordinary concepts for the income year ended 30 June 2009. Accordingly, it found that foreign employment income derived by the taxpayer was properly included in his assessable income for Australian tax purposes.
The taxpayer left Australia on 16 April 2008 after being offered work in the oil and gas industry with a Qatari company. He remained in Qatar until his employment with the company ended on 29 July 2010, and returned to Australia on 1 August 2010. The Commissioner issued an amended assessment to the taxpayer for $52,030.55 in respect of the Qatari employment income derived for the 30 June 2009 income year. The taxpayer broadly contended that he was not a resident of Australia for the relevant period as he had the intention of permanently leaving Australia to pursue a career in the oil and gas industry overseas.
The AAT considered eight factors in deciding whether the taxpayer was an Australian resident according to ordinary concepts, including physical presence in Australia, family and business ties, and maintenance of a place of abode. It noted that the taxpayer had an Australian property that he maintained and intended to live in, retained his bank accounts and an Australian super fund, was paid by the Qatari company in Australian dollars and was only in Qatar for work purposes for a definite period of time.
The AAT therefore found that the taxpayer was a resident of Australia as he maintained a "continuity of association" with Australia for the relevant period, despite his physical absence from Australia. The foreign income derived by the taxpayer was therefore assessable.
Re Sneddon and FCT [2012] AATA 516, www.austlii.edu.au/au/cases/cth/AATA/2012/516.html
