Australian residence - parent or non-parent carer 1.6.1
Version 3.0, Last updated 22 November 2012 8:30am
ContextIt is necessary for the Registrar to make a determination about whether a parent is a resident of Australia for a number of purposes relating to provisions of the Child Support (Assessment) Act 1989 and the Child Support (Registration and Collection) Act 1988.
Legislative referencesSections 10, 12, 25 and 25A Child Support (Assessment) Act 1989
Section 4 Child Support (Registration and Collection) Act 1988
Sections 6, 7A(2) Income Tax Assessment Act 1936
ExplanationIt is necessary for the Registrar to make a determination about whether a parent is a resident of Australia in order to determine, among other things:
whether an application for administrative assessment is properly made and able to be accepted (see Chapter 2.1.1 for more information)
whether the appropriate income rules are being used to determine an assessment (see Chapter 2.4.4 for more information)
whether an overseas maintenance liability can be registered (see Chapter 3.6.2 for more information), and
whether a terminating event has occurred (see Chapter 2.10.3 for more information).
A person is a 'resident of Australia' for the purposes of the Assessment Act and the Registration and Collection Act if they are a resident of Australia for the purposes of the Income Tax Assessment Act 1936 (section 10 Assessment Act, section 4 Registration and Collection Act and section 6 Income Tax Assessment Act).
However, a person is not a resident of Australia for the purposes of the Assessment Act if they are a resident of Norfolk Island, the Territory of Cocos (Keeling) Islands or the Territory of Christmas Island (section 10 Assessment Act, section 7A(2) Income Tax Assessment Act).
For the purposes of the Registration and Collection Act only, the definition of a resident of Australia does not include a person who is a resident of a reciprocating jurisdiction (section 4 Registration and Collection Act). See Chapter 1.6.3 for more information about when a person is considered to be a resident of a reciprocating jurisdiction.
The Registrar will apply the same tests as the Australian Taxation Office when it decides whether a person is a resident of Australia for child support purposes. These tests are summarised below. More information in relation to these tests is available on the Australian Taxation Office website.
The primary test is whether the person resides in Australia. Where a person has always lived in Australia and continues to live in Australia they will clearly be a resident of Australia.
Australian resident leaving AustraliaWhere a person who was an Australian resident leaves Australia, the Registrar will consider whether the person continues to be a resident of Australia according to:
the ordinary meaning of 'resident', or
the statutory domicile and permanent place of abode test, or
the statutory superannuation test.
Non-resident entering AustraliaWhere a person who was not previously a resident of Australia enters Australia, the Registrar will consider whether the person has become a resident of Australia according to:
the ordinary meaning of 'resident,' or
the statutory 183 day test.
Ordinary meaning of 'resident'
The word 'resides' has its ordinary meaning for this test. The Macquarie Dictionary defines 'reside' as 'to dwell permanently or for a considerable time; have one's abode for a time', and the Shorter Oxford English Dictionary defines it as 'to dwell permanently or for a considerable time, to have one's settled or usual abode, to live, in or at a particular place'.
Australian resident leaving AustraliaWhen considering whether a person has ceased to be a resident of Australia according to the ordinary meaning of the word 'resides', the Registrar will take into account the person's intention in going overseas and the length of their intended stay overseas.
A person who usually resides in Australia but is overseas on holidays continues to reside in Australia during their absence.
Where it is not clear that the person who has left Australia continues to be a resident of Australia according to ordinary concepts of residency, the statutory tests will be considered.
Non-resident entering AustraliaWhen considering whether a person who was not previously a resident of Australia has become a resident of Australia according to the ordinary meaning of the word 'resides' the Registrar will take into account:
the person's intention or purpose of presence in Australia and overseas. For example, a migrant who comes to Australia intending to reside here permanently is a resident from arrival. A person who has travelled to Australia for a holiday will generally not be a resident of Australia.
the person's family and business/employment ties in Australia and overseas. For example, a person who is in Australia for employment or education purposes is more likely to be considered a resident of Australia.
the location of the person's assets and the arrangements they have made to maintain them.
the person's social and living arrangements in Australia and overseas. Arrangements that may indicate that a person is residing in Australia may include joining sporting or community organisations, enrolling children in school or committing to a residential lease.
the period the person has been physically present in Australia. In most cases a visit of less than six months is not a sufficient time to consider that a person is residing in Australia.
The weight given to each factor will vary according to the circumstances of the individual.
Domicile and permanent place of abode testThis test generally applies to Australian residents who leave Australia.
A person whose domicile is in Australia continues to be a resident of Australia unless their permanent place of abode is outside Australia.
DomicileA person acquires a domicile of origin at birth. This is the domicile of their parents.
A person whose domicile is Australia will maintain their Australian domicile unless they acquire a different domicile by choice or by operation of law.
Generally, a person will have acquired a new 'domicile of choice' in a particular country if:
they are legally present in a country, and
they have formed an intention to remain in that country for the foreseeable future, and for a period that they regard as indefinite.
A person will generally not have acquired a new 'domicile of choice' in a country if:
they intend to leave the country in the foreseeable future, for example on the completion of a contract of employment or other project, or
they intend to return to their country of origin on the occurrence of some definite future event, such as retirement (even if the timing for their retirement is distant and uncertain).
However, a willingness to move to another country if better opportunities present themselves, or a hope of returning to one's homeland at some unspecified time in the future, will not defeat an intention to acquire a new domicile of choice.
Generally, for the Registrar to be satisfied that a person has acquired a new domicile of choice, the person needs to have demonstrated by their actions that they genuinely do have an intention to reside in the new country indefinitely—for example obtaining a migration visa or citizenship in the new country.
If a person's domicile is outside Australia they will not be considered to be a resident of Australia under this test, and there is no need to consider the 'permanent place of abode' part of the test. If the person's domicile is Australia, their permanent place of abode needs to be considered.
Permanent place of abodeA permanent place of abode does not have to be 'everlasting' or 'forever'. A person who intends to return to live in Australia in the foreseeable future can still set up a 'permanent place of abode' elsewhere. If a person whose domicile is in Australia is residing elsewhere, the Registrar will take into account the following factors when deciding if that other country is their permanent place of abode:
the intended and actual length of the person's stay in the overseas country:
The duration of a person's stay overseas is not conclusive, and must be considered in conjunction with other factors. As a broad rule of thumb a period of two years or more may be regarded as a substantial period.
the person's intention to return to Australia at some definite point in time or to travel to another country:
Generally if a person has an intention of returning to Australia at the end of a 'transitory' stay overseas, they will not be considered to have established a permanent place of abode outside Australia. Whether a stay overseas is 'transitory' depends on all the circumstances, but as a general rule of thumb a stay of less than two years may be considered 'transitory'.
whether the person has established a home outside Australia:
If the person has established his or her home in an overseas country (e.g. purchased a house or apartment to live in or entered into a long-term lease on a home), this tends to show the place of abode in the overseas country is permanent.
whether the person has abandoned their residence or place of abode in Australia:
If the person maintains a home in Australia that is available for them to live in while they are outside Australia, it may tend to suggest (in conjunction with other factors) that the person remains resident in Australia. If the person has sold or rented out their home in Australia it may tend to suggest that the person has established a permanent place of abode overseas.
the duration and continuity of the person's presence in the overseas country:
If the person has no fixed or habitual place of abode overseas but moves, for example, from one country to another, this may tend to suggest that the person has not established a permanent place of abode outside Australia.
the durability of the person's association with a particular place in Australia:
It is not necessary for a person to close all Australian bank accounts in order to establish a permanent place of abode overseas. For example, if a person moves their 'everyday use' accounts to the overseas country but maintains a long term investment account in Australia they may still be able to establish, on the basis of other factors, that they have a permanent place of abode outside Australia.
If the person's children are enrolled at and attend school in the overseas country, this may tend to suggest that the person has established a permanent place of abode overseas. If the children continue their schooling in Australia despite the presence of adequate educational facilities in the overseas country this may tend to suggest that the person has not established a permanent place of abode outside Australia.
The weight to be given to each factor will vary with individual circumstances of each case and no single factor is conclusive.
Superannuation testThis test applies to current Commonwealth Government employees.
The test states that a person is a resident of Australia if the person is:
an eligible employee under the Superannuation Act 1976, or
a person who is a member of the superannuation scheme established under the Superannuation Act 1990.
The test is designed to ensure that Commonwealth Government employees working at Australian posts overseas are still Australian residents for tax purposes. If a person is a resident of Australia under this test the person's spouse and any children under 16 years are also Australian residents.
The effect of this test is that current Commonwealth Government employees who are members of the Commonwealth Superannuation Scheme (CSS) created by the Superannuation Act 1976 or the Public Sector Superannuation Scheme (PSS) created by the Superannuation Act 1990 are residents of Australia.
A person who is not a current Commonwealth Government employee is not a resident of Australia pursuant to this test.
This test does not deem a person who is a member of the Public Sector Superannuation Accumulation Plan Scheme (PSSap) created by the Superannuation Act 2005 to be a resident of Australia.
183 day testUnder this test, a person who is actually present in Australia for more than half the income year (i.e. Australian financial year), whether continuously or intermittently, is a resident of Australia unless:
the person's usual place of abode is outside Australia, and
the person has no intention to take up residence in Australia.
Note: The phrase 'usual place of abode' does not have the same meaning as 'permanent place of abode'. The terms 'usual' and 'abode' should be given their ordinary and natural meanings.
The shorter Oxford Dictionary gives the following definitions:
usual means current, ordinary, customary, and
abode means habitual residence, place of habitation, house or home.
The 183 day test must be applied to each income year separately, and for that reason it cannot be used to determine a person's residency status beyond the end of the particular income year being considered.
www.humanservices.gov.au/corporate/publications-and-resources/child-support-guide/part-1/1-6-1