Residential Status Of Dale

Residential Status Of Dale.


Discuss about the Residential Status of Dale in Financial Year 2017 and 2018.


Residential status of Dale in financial year 2017

To find that you are liable to tax first thing is needed to understand whether you are the resident of that country or non-resident. Every country has their different rules for checking the residential status. It is not necessary for you to being an permanent citizen of that country to be a resident (ATO, Are you an australian resident for tax purpose, 2016). In Australia, the rules are made for checking the residential status of a person, firm, company, etc. it is not necessary that you have visa of Australia so you can be treated as a resident of the country. There are different rules are made for different situation to find the residential status.

Dale is studying mechanical engineering at Monash University. He completed high school in France and then a bachelor of engineering in Germany. Most of his family members are in France, some are in Germany. He holds a UK passport, and currently undertakes a postgraduate degree in Australia based on a three year student visa.His first arrival in Australia is on 3 April 2017 and he came on student visa and he spent some of the months in country. In the month of May he also visited New Zealand. In July 2017, he took a rented apartment in Australia and entered into a one year lease.

Provisions for foreign students studying in Australia have different rules for residential status in comparison to the resident. You will be treated as a resident of Australia if you are an overseas student and pursuing a course in Australia having duration of more than six months.If you came on the tourist visa and most of that you are travelling and working then you will be treated as non-resident of the country or foreign resident (ATO, Residency test, 2016).

Dale came in Australia on 3rd April 2017 and spent most of his time in travelling and he comes on a tourist visa. In July 2017, he rented an apartment to complete his professional degree. He reside in Australia for 89 days in financial year 2017 which is less than the period of six months. Therefore he will not be treated as a resident of the Australia for taxation purpose in financial year 2017. He does not live in Australia for 183 days and different tax rules will be applied on Dale in financial year 2017.

Residential Status of Dale in financial year 2018

The Courts used the definition of resides to determine that whether the person is an Australian resident for taxation purpose. The reside term is not defined in the provision of income tax assessment act. Residential status of individual is described in Taxation Ruling TR 98/17 (ATO, Work out yoru residency status for tax purpses, 2017). The ruling outlines the circumstances where the individual is considered to be resident of the country or not. People entering in Australia have different reasons such as:

  • Migrants
  • Academics teaching or studying in Australia
  • Students studying in Australia
  • Tourists, and
  • People those have pre-arranged employment contracts

Your domestic and economic affairs also affect your residential status. It is highly depends on your activities and behaviour. The rule for the student studying in Australia remains same as the course lasts for six months or more, and then you will be treated as Australian Resident for tax purpose. This means:

  • You have to pay tax on the income earned at the time you are residing in Australia.
  • Benefits will be available for you that is available for the Australian citizens that means deduction benefit can be availed by you and tax offsets is also available to you.

The Australian residents have to give all the information regarding the income you have earned in the country or outside the country. The overseas students resides in Australia on a temporary visa that means they are the temporary residents of the Australia and certain exemptions are available to the students studying in Australia (ATO, Residency-the resides test, 2017).

Dale got a job in August 2017 in an engineering firm and he came in Australia in a student visa of 3 years. The duration of his professional degree is 3 years that means he will live in Australia for 3 years. The financial year starts from July and end in June. He lives in country for more than six months in financial year 2018 and he will be treated as Australian resident for taxation purpose in financial year 2018.The earnings earned by him from the part time job will be liable to tax and he has to pay tax on the taxable income. The provisions of Australian resident will be applied on him and he has to file income tax return for the financial year 2018.


ATO. (2016). Are you an australian resident for tax purpose. Retrieved December 2016

ATO. (2018). Foreign income exemption for temporary resients. Retrieved March 2018

ATO. (2016). Residency test. Retrieved august 2016

ATO. (2017). Residency-the resides test. Retrieved April 2017

ATO. (2018). Studying in Australia. Retrieved March 2018

ATO. (2017). Work out yoru residency status for tax purpses. Retrieved June 201

Residential Status Of Dale

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