Expats and off shore income

Terry (and any other experts) your thoughts please.

See this link: Foreign income exemption for temporary residents - introduction

If a lady was an expat based outside of oz before 2006 and returned back to oz and with her husband was not a citizen and he stayed in oz "temporarily" eg perhaps every half year going overseas, do you read this as the last being exempt from paying any tax on foreign earned income whilst back in Oz?

Thanks !!!

 

Expat is not a tax term. It can be misinterpreted. What is the tax residnecy and dates involved ?Inbound/ outboaund and other issues. Citizenship and much more

Personal tax advice will avoid serious concerns with tax, CGT, costbase issues, land tax, stamp duty and FIRB

As your question involves determining a tax liability a lawyer must be a registsred tax practitioner to advise. Its a tax agent service

 

Noted. Lady is Australian who has lived overseas since before 2006. Her husband is from Indonesia.

 

"Temporary resident" actually refers to special category visas such as section 457, not relevant by the sound of it.

Wife: Previously a resident & returning to settle = likely a resident. If merely visiting and maintaining a permanent place of abode in Indonesia may suggest not a resident.

Husband: If frequent & regular visits to wife who is residing in Australia then this may suggest he resides here. Depends on frequency & duration. Also depends upon family, business and other ties overseas and how settled he may be in Indonesia.

It may also depend on the international tax treaty between Australia and Indonesia.

Not enough facts ... you need specialist advice based on full disclosure of facts. A taxation law practice specialising in international tax is recommended.

 

Thanks Rob.

The ATO website says:

"Under the Social Security Act 1991, an Australian resident is generally a person who resides in Australia and is either an Australian citizen or holds a permanent resident visa. Taxpayers who hold a protected special category visa and were in Australia on or before 26 February 2001 are also considered to be Australian residents for the purposes of the Social Security Act 1991."


If I go to the Social Security Act 1991, it states that:

2) An Australian resident is a person who:
(a) resides in Australia; and
(b) is one of the following:
(i) an Australian citizen;
(ii) the holder of a permanent visa;
(iii) a special category visa holder who is a protected SCV holder.

So, I am inclined to conclude that the Indonesian husband would not be considered an Australian resident, and that as such, the lady would be exempt from foreign income tax.

I have tried to see if there is any ruling on this or interpretation etc, but have not had any luck so far!

 

Maybe. Often its easier than that and can be resolved and this may overstate the experience and qualificatiosn of those in some firms. I tend to address this in our free consult with such enquiries and when it needs that focussed effort I will refer to such a specialist.

I encountered such a concern for a prawner out of Broome and another out of Darwin. Both AU residents based on time here but AU law didnt see a spouse as they failed statutory residency and any permanence. Some occupations can even be seasonal and transitory

Its also a common tax view that an Aussie in PNG who has no right to stay is a AU tax resident. Even ATO residency calculator says that. But their income is NOT subect to AU tax.

Social Security Act is not the ITAA. What does reside mean !! For a inbound person there is a statutory test to consider along with common law

 

Tax residency is what needs to be determined.

There are lots of possible elements to testing tax residency, it may not be clear cut.

 

Ummm ... the lady may not be exempt from tax from the information you have provided.

You seem to be saying that the spouse of a temporary visa holder is also exempt from tax ... even if the spouse does not hold a temporary visa ?

The exemption only relates to the temporary resident visa holder who also complies with other conditions.

If the wife is an Australian citizen and accompanies her husband to Australia then neither may end up being exempt from tax on foreign source income.

We really do not know what exactly you mean by "expat".

You really need to seek legal advice with full disclosure of your facts to get a reliable opinion.