Tax Assignment For Australia Tax
My firm will be happy in advising you in the matter of your residency taxation that you have discussed with us on 5th June 2019. We have understood that you are excited about working abroad. However, at the same time, you want to preserve your Australian residence. You have clearly highlighted your concern that if the Australian Taxation Office does not consider you as a non-resident of Australia during the years you would be working in New Zealand, then only you can go to New Zealand. Otherwise, you will continue to live in Australian for preserving your Australian Residency. Therefore, you have requested legal advice considering your situation that if it is possible to preserve your Australian residence being a non-resident of Australia for the two years when you will be working in New Zealand. You have also mentioned that after two years you will be back to your old residence in Australia for spending time with your family. Considering your circumstances, we are going to advise you regarding the issue you have addressed in our last discussion with you.
home is in Australia or not (oecd.org, 2019). According to the superannuation test, the persons working under the Australian Government can be considered as an Australian resident even if they work abroad. Along with that, the person living in Australia more than 183 days can be considered as an Australian resident (Kenny, Blissenden & Villios, 2015). Considering these rules, it can be said that in the resides test you will be proved an Australian resident as your permanent home is in Australia and you have stayed in Australia more than 183 days and also want to shift in Eastern Australia permanently after two years. Additionally, the residential status of an Australian resident cannot be changed just because the person works in Abroad (Lam & Whitney, 2016). You have mentioned in your advice request that you want to preserve your permanent home in Australia and want to shift in Eastern Australia permanently after two years of working in abroad. Therefore, if you want to preserve your Australian residence, you need to meet your tax claims properly. If you work in New Zealand, then also you need to pay income taxes in New Zealand and the residential and property taxes in Australia. However, in this context, you can claim a tax offset in Australia as you are earning in other country. You also need not to pay the Medicare levy charges in Australia. However, if you earn any dividend from any investment in Our understanding
We want to make you aware of the fact that as per the guidelines of the Income Tax Assessment Act 1936, an Australian resident needs to pay the income tax along with the residency taxes applied to the person by the ATO (oecd.org, 2019). However, residency is a major factor that is subject to different types of residency tests. As per the residency taxation policies of the ATO, you need to undergo different resides tests like the domicile tests, superannuation test or 183 days test that will determine if you are an Australian resident or not (quillgroup.com.au, 2019). In the domicile test, it is checked that if your permanent Australia, that will be a taxable income in Australia. However, in this context, you can take help of your legal advisor or a spouse or close relative for paying your taxes for the financial year by providing the person a power of attorney of your properties (allianz.com.au, 2019).
Therefore, after considering your circumstances, we recommend you to remain in Australia if you want to pay the residential taxes by your own. Otherwise, if you do not want to miss the opportunities to work abroad, you might take the help of your spouse or a close relative for paying the residential taxes.
However, in your advice request, you wanted to be considered as a non-resident for the two years when you will be working in New Zealand which is not possible for tax purpose as oer the residential taxation rules of ATO. Therefore, it will be better for you to remain in Australia for preserving your Australian residences. Otherwise, if you go abroad for working and the tax claims are not met for any reason, it will be difficult to retain your Australian residences. Along with that, you need to pay income taxes in New Zealand and Australia. However, in this context you can claim a tax offset in Australia. However, if you can trust your legal advisor or a close family member to provide a power of attorney of your residence, it might be possible for the legal advisor or the relative to meet the taxation claims along with other financial claims in your absence in Australia. In this process, you need not miss your opportunity of working in New Zealand and also you can take part in the Triathalon races after you come back to Australia. However, in this context, you need to decide if you can trust any person or firm for providing the power of attorney for that period considering his ability to meet your taxation claims during your absence in Australia.
However, in this context, it needs to be clarified that the information contained in this letter is only appropriate for the highlighted circumstances of Gabby. It also should be noted in this context, that if the presented circumstances are changed, advises might become void and it will be illegal to use any part of this advice for the circumstances of other persons. In such cases, the legal firm will not remain liable for any negative consequences resulted from the misuse of legal advice.
Please do not hesitate to contact Mr. Griffith Hudson on 4455667788 for any queries related to the legal advice.
(Legal advisor at Allen Arthur Robinson)
allens.com.au (2019) Overview of the law firm Retrieved on 2nd September 2019 from https://www.allens.com.au/
allianz.com.au (2019) Power of attorney rules in Australia Retrieved on 12th September 2019 from https://www.allianz.com.au/life-insurance/news/what-is-a-power-of-attorney
Kenny, P., Blissenden, M., & Villios, S. (2015). Residency and Australians working overseas: can be an expensive lesson in tax Law. Retrieved on 3rd September 2019 from https://dspace2.flinders.edu.au/xmlui/bitstream/handle/2328/38967/Kenny_Residency_P2015.pdf?sequence=1&isAllowed=y
Lam, D., & Whitney, A. (2016). Taxation and property: Practical aspects of the new foreign resident CGT witholding tax. LSJ: Law Society of NSW Journal, (21), 84. Retrieved on 2nd September 2019 from https://search.informit.com.au/documentSummary;dn=949913004693106;res=IELAPA
oecd.org (2019) Australian taxation rules Retrieved on 3rd September 2019 from https://www.oecd.org/tax/automatic-exchange/crs-implementation-and-assistance/tax-residency/Australia-Residency.pdf
quillgroup.com.au (2019) Resides tests Retrieved on 3rd September 2019 from https://www.quillgroup.com.au/blog/australian-resident-for-tax-purposes-explained/