Taxation Law Issues Question and Answer 2022

Running head: TAXATION LAW
Taxation Law
Name of the Student
Name of the University
Author Note

TAXATION LAW1
Question 1
Issue
Whether he is an Australian resident or non-resident for tax purposes for the 2017/18 and
2018/19 years.
Rule
Section 6-1 of the ITAA36 provides for certain tests that can be applied for the purpose of
determining the residential status of an individual.
Resides test: The resides test requires a person to dwell or live in Australia for a
considerable timespan.
Domicile test: The domicile test requires a person to be a domicile in the territory of
Australia, which signifies having a permanent dwelling place and having no permanent place
of abode outside Australia. There are certain factors that are required to be assessed while
determining the residential status of an individual under the domicile test (Woellner et al.
2016). These are –
1. Actual stay or intended stay in overseas.
2. Motive of returning to Australia within a definite timespan.
3. Setting up a house outside the territory of Australia.
4. Giving up or selling a place of abode present in Australia.
5. Continuity and duration of presence overseas.
6. Timespan for which the individual has been associated with any place within
Australia.

TAXATION LAW2
183-day: This test requires a person to be permanently and intermittently living in
Australia. However, if it has been ensured that the person has a permanent place of abode
outside the territory of Australia, this test will not apply (Woellner et al. 2016).
It has been held in the case of Applegate v Federal Commissioner of Taxation (1978) 8
ATR 372 that the permanent stay does not imply forever, but depict a stay is not temporary.
Application
For the year 2017/18: Firstly, the actual stay or the intended stay of Adam in Dubai is for
less than 6 months, which accrues merits towards the fact that he is a resident in Australia.
Secondly, he has been temporarily living in Dubai and has all the intentions to return to
Australia. Thirdly, Adam never established any permanent residence in Dubai, the residence
he has rented was for his temporary stay for employment. Fourthly, she did no sell his
permanent place of abode located in Australia. Fifthly, his presence in Dubai was for
temporary period. Lastly, he has been associated with Australia all through the year as his
family stayed in Australia and he has is house located in Sydney. Hence, he is a resident in
Australia for the year 2017/18.
For the year 2018/19: Firstly, it was a relocation and not a temporary stay in Dubai as he
has taken his wife with him for the stay and transferred their kids to a boarding school.
Secondly, his stay in Dubai was permanent as he has purchased an apartment. Thirdly, he has
purchased and apartment in Dubai. Fourthly, although he did not sell his house in Australia
but he has rented that house and has been desiring to live in Dubai for an indefinite period.
Fifthly, it has been provided by the facts that he has been living in Dubai for an indefinite
period. Lastly, he has been desiring to visit his house in a six week annual leave and has been
desiring to inspect his house during that time and he has also being maintaining joint bank
account and private health insurance in Australia but his intention to live in Dubai for an