For Australian employers looking for opportunities overseas a key consideration in reviewing their project costing is the tax residency of their workforce. Similarly, for an Australian taxpayer looking at opportunities overseas, whether it’s a working trip around Europe or an assignment in Asia, the question of their residency for taxation purposes can have a significant impact. Also, there is an increasing number of foreign workers coming to Australia, both permanently and temporarily, and there are often questions about their residency for taxation purposes.
This paper reviews the legislation and consider current rulings, practices and tax planning in the following areas:
- categories of residency
- becoming an Australian resident
- changing from a temporary to a permanent Australian resident
- ceasing to be an Australian resident
- double tax treaties
- the effect on self-managed superannuation funds, family trusts and other entities.