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Questions On Tax Payer Will Be A Residence

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Question 1
Introduction
Tax payer will be a residence if one of the four tests in 6(1) ITAA36 is satisfied. The residence identity will be determined on a year-by-year basis, and a tax payer can be a resident for tax purpose for the whole or a part of the financial year. The main issue discussed is that whether Ernie is a taxpayer in the income year ended 30th June 2016.

Relevant Fact and Evidence
Four tests need to be all failed to recognize Ernie as a foreign resident for tax purpose.

Ordinary residence test (ORT)
ORT is the primary test of residency. Ernie is a resident for tax purpose if he resides in Australia (s 6(1) ITAA36). Whether TP “resides” in Australia is a question of a fact, which is to be determined by case-by-case (Lysaught; Joachim). “Resides” means live permanently or considerable time in a particular place (Levene). In the case, Ernie has not been present in Australia during the year, therefore he is not an Australian resident for tax purpose.
Tax Ruling (TR) 98/17 has stated the further factors for guidance that may be applicable to the case. Also, no single factor is determinative and the weight to be afforded to each factor depends on the circumstances of each individual taxpayer concerned: Shand [2003].

a) Family and business ties
Ernie remained his membership of Institute of Chartered Accountants and his shares which are invested in Australian market. All his social relationships stay in Australia. While the fact indicates Ernie has business

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