Taxation Law Asignment

LAWS 7012 TAXATION LAW

SEMESTER 1 ASSIGNMENT

Student name: Fangzhou Qiu

Student no: 42304472

Q1

Issue: Is the client a resident of Australia for tax purpose under ITAA1997?

Law:

|

|

|

* The definition of ' "resident" or "resident of Australia" ' is in subsection 6(1) of the 1936 Act. The primary test for deciding the residency status of an individual is whether the individual resides in Australia according to the ordinary meaning of the word 'resides'.

* TR 98/17, para 14

Factors considered by the courts are:

* Physical presence in Australia

* The purpose of the visits to Australia and abroad

* The maintenance of a place of abode in Australia for the taxpayer’s use

* The person’s family, business and social ties

* The person’s nationality

* The Levene v IRC (1928) AC 217 case is one of the leading authorities on what constitutes ordinary residence.

Application:

Examine the factors in determining ordinary residence under TR 98/17

* The client is an airplane pilot for Emirates Airlines. Though he pilots long international flights, and accommodated in Dubai and various European cities, the client spends at least some time physically present in Australia during the year of income.

* The client owns a house in Sydney, and lives with his wife; the maintenance of a place of abode in Australia is an important factor contributing to the fact that the client continues to be a resident in Australia.

* The purpose of abroad is merely temporary; the client stays in transitory accommodation during stopovers. Staying for a short period for work purposes is normally insufficient to establish client’s intention to reside overseas.

|

|

|

* The client also maintains strong family, social ties with Australia, his wife lives in Sydney, and there is a bank account operated by the client and his wife; himself is also a Flight Lieutenant in the Royal Australian Air Force Reserve. Those ties will...