Australian Day is a day to celebrate with two-up, emu racing, and our fantastic beaches. Many people choose to become Australian citizens on this day. You’re entitled to the freedoms of our great country, as an Australian citizen. Moreover, you are being obligated to pay personal income tax. You must take into account that the tax laws work a little differently than the same residency tests used by other Australian agencies, such as immigration.
Know if you’re paying the right amount of tax?
You need to understand your residency status in the eyes of the ATO to understand your tax situation. Even if you’re not an Australian citizen you may be classified as a resident for tax purposes. To determine if you are an Australian resident for tax purposes, you’ll need to satisfy one of four residency tests.
The Resides Test
You will be seen to ‘reside’ in Australia if you live in Australia and ‘dwell permanently’ in a usual abode or particular place. The test will include your physical presence in one location, family, business and employment ties, intention, and purpose of your stay, maintenance, and location of assets, social and living arrangements.
The Domicile Test
A domicile will have a degree of permanence for you and is considered to be your permanent home by law, and is not transitory in nature. Domicile is something more than a residence and you may only have one domicile at one time.
The 183 Day Test
You may be looked upon as having your abode inside of Australia if you are present in Australia for more than half of the income year. The residence that you are using to live can be on a continuous or intermittent basis. It doesn’t have to be a fixed location, and your ‘usual place’ of abode is not seen as your ‘permanent place of abode’. However it must exhibit sighs of residence rather than that of a transient traveler. This test called a 183-day test only applies to individuals arriving in Australia.
The Commonwealth Superannuation Fund Test
This test only applied to the CSS (Commonwealth Superannuation Scheme) or some Australian Government employees who contribute to the PSS (Sector Superannuation Scheme). If you fall under this category, you will be considered a resident of Australia regardless of other features.
As an individual in Australia, you’ll fit into one of three categories:
- An Australian resident for tax purposes
- A foreign resident in Australia
- Temporary resident in Australia
Australian residents, foreign residents, and temporary residents are all able to employ the help of a tax agent when they declare their income and lodge their tax return. A KPG tax agent has undergone rigorous education and experience and will be able to advise and guide what you’ll need to do.
KPG Taxation has helped Australian individuals and businesses grow. Phone 03 9706 9313 and chat with one of our friendly Tax Accountants today. You’ll also be able to book an appointment online to find a date and time that suits you.
Call 03 9706 9313, or book online at www.kpgtacation.com.au and your tax agent will be in touch to help.
For detailed info, visit our office on this address: 1/11 John Street, Pakenham VIC 3810, Australia
Phone: 03 9706 9313