*Indian taxpayer a ‘resident’ despite absences from Australia – but he and his wife did own a house here and she and their adult children lived here [30]

The AAT has held that a taxpayer had not discharged his burden of proving that an assessment was excessive, and effectively held that he was an Australian “resident” in the 2011 income year. The facts were as follows.

• The taxpayer is an engineer and was born in India and remains an Indian citizen.
• He came to Australia in about 1989.
• After working for a company in Australia from 2007 to early 2010, the taxpayer left Australia on 1 June 2010 to commence employment in Singapore, where he lived in a serviced apartment.
• In January 2011, the taxpayer and his wife purchased a property in Western Australia where he lives when he is in Australia and since being purchased, it has been the home of his wife and adult children, all of whom are Australian citizens.
• On 30 April 2011, he ceased his employment in Singapore and in May that year, he commenced new employment in India.
• The taxpayer lived and worked in India until 31 July 2011 and then returned to Australia on 2 August 2011.
• Between October 2011 and July 2012, he worked in India for a total period of 6 months.

The taxpayer applied to the ATO for a private binding ruling that he was not a resident of Australia for income tax purposes “from financial year commencing on 1 July 2010”. However, the Commissioner issued a Private Ruling in relation to the 2011 and 2012 income years in which he ruled that the taxpayer was an Australian resident for income tax purposes in those years. An assessment was issued for the 2011 year treating him as a resident of Australia for tax purposes. The taxpayer’s objection to the 2011 assessment was disallowed and he sought review.

After reviewing the evidence and an examination of the relevant law, including the Australia/Singapore and Australia/India DTAs, the Tribunal concluded that the taxpayer had not discharged his burden of proving, on the balance of probabilities, that the assessment was excessive, and it affirmed the Commissioner’s objection decision.

(AAT Case [2013] AATA 394, AAT, Walsh SM, AAT Ref: 2012/4009, 12 June 2013.)

[LTN 114, 17/6/13]