PILLAY v FC of T
Members:SE Frost DP
Tribunal:
Administrative Appeals Tribunal, Sydney
MEDIA NEUTRAL CITATION:
[2013] AATA 447
SE Frost (Deputy President)
1. The applicant is a doctor who has been working outside Australia since 2006.
2. For the purpose of clarifying his tax residence status, he sought a private ruling from the Commissioner in October 2011. The proposition that he asked the Commissioner to agree with was that he had been a non-resident of Australia during the income years ended 30 June 2010 and 30 June 2011, and that he would be a non-resident during the year ending 30 June 2012 (together, the relevant years).
3. The Commissioner, however, did not agree. Instead he issued a ruling that Dr Pillay was a resident of Australia during the relevant years for Australian taxation purposes. Dr Pillay objected against the ruling but the objection was disallowed.
4. The question for the Tribunal is whether the objection decision of the Commissioner is correct. In other words, was Dr Pillay a resident of Australia or not?
PRIVATE RULINGS
5. The system of private rulings and the way they are reviewed in the Tribunal were recently explained by Deputy President Alpins in
Cooper Bros Holdings Pty Ltd trading as Triple R Waste Management and Commissioner of Taxation [2013] AATA 99 as follows:
- [4] The Commissioner may make a private ruling upon application by a taxpayer (ss 359-5(1), 359-10 in Sch 1 to the TAA[1]
The “TAA” is the Taxation Administration Act 1953 - [5] A taxpayer may object against a private ruling in the manner set out in Part IVC of the TAA; the ruling is taken to be a "taxation decision" within the meaning of that Part (s 359-60 in Sch 1 to the TAA). In this proceeding, the applicant has the burden of proving that the private ruling should have been made differently (s 14ZZK(b)(iii) of the TAA).
- [6] As the prefatory provision of Div 359 (s 359-1) explains, "[a] private ruling is an expression of the Commissioner's opinion". As that opinion concerns a particular question about the application of tax law to the facts identified in the ruling comprising the specified scheme, the Tribunal's jurisdiction is therefore limited to a review of the Commissioner's opinion on that same question. The question before the Tribunal is whether the Commissioner's opinion was correct (
Federal Commissioner of Taxation v McMahon and Another (1997) 79 FCR 127 at 132-134, 140-141, 149-150;
Federal Commissioner of Taxation v Reef Networks Pty Ltd (2004) 57 ATR 375 at [6];
Lamont v Federal Commissioner of Taxation (2005) 144 FCR 312 at 319;
Cooperative Bulk Handling Ltd v Federal Commissioner of Taxation [2010] FCA 508 at [13], [15]-[16]). The answer to that question therefore depends upon the scheme on which the ruling is founded - the Tribunal's review turns on the specified scheme just as the ruling did. - [7] As Lockhart J said in McMahon at 133, quoted with approval by the Full Federal Court in
Hastie Group Ltd v Commissioner of Taxation (2008) 172 FCR 496 at [3]:When making a private ruling the Commissioner does not make findings of fact. He simply identifies facts and then states his opinion about the way in which the relevant tax laws apply to the applicant in relation to those identified facts.
(see also McMahon at 149 per Emmett J; Lamont at [23]; Cooperative Bulk Handling at [15]).
- [8] That being so, the Tribunal cannot make findings of fact in this proceeding. The Tribunal can only consider the stated facts comprising the scheme the subject of the ruling. Furthermore, the Tribunal cannot "redefine" the scheme (see McMahon at 133, 141, 144-146, 150) - the Tribunal is confined by the scheme as it has been described in the ruling and cannot depart from that description in any respect. The Tribunal cannot create its own description of the scheme, elaborate upon or make assumptions about the scheme, nor can the Tribunal add further facts, substitute other facts or otherwise alter the scheme (McMahon at 133-134, 140-146, 149-150;
Bellinz v Federal Commissioner of Taxation (1998) 84 FCR 154 at 160; Reef Networks at [6]; Lamont at [21], [26]; Hastie Group at [3]; Cooperative Bulk Handling at [16]).
THE "SCHEME" AS IDENTIFIED IN THE RULING
6. The Commissioner identified the "scheme" as follows[2]
You are an Australian citizen.
Your country of origin is South Africa.
Initially you were a reservist medical officer with the Australian Defence Forces (ADF) in East Timor and then in the Middle East. You then returned to East Timor with the private medical contracting company Aspen Medical.
You have been employed by Aspen Medical, in East Timor, since December 2006, initially as a casual employee and then, from 12 May 2008, on a yearly full-time contract. You have continued to renew this contract. You have been informed by Aspen Medical that you will be offered the renewal as long as then (sic) maintain their contact with East Timor. Their contract with East Timor is due to be renewed at the end of 2012. You will continue to renew your contract with them until either the conclusion of Aspen Medical's contract in East Timor or upon reaching 65 years old.
You (sic) work in East Timor has meant that you have been in East Timor for between 9 and 11 months of each year since 2006. The 6 to 8 weeks of the year you spend in Australia is divided between the Sapphire Beach dwelling and visiting your 5 children (aged 27 to 41) and 1 grandchild. Your spouse also uses it for such visits. The rest of the year the Sapphire Beach dwelling is left vacant.
Your spouse, a New Zealand citizen and Australian tax resident, moves between the family's home in Sapphire Beach, NSW, Australia, and a house in Bali, on which you and your spouse purchased a 55 year lease approximately 5 years ago.
You state you have maintained Australian bank accounts because neither you nor your spouse is an Indonesian citizen and, as such, not allowed to open an Indonesian bank account and banking services in East Timor are limited. However, as an Australian citizen you are entitled to open an Australian bank account, a move which is practical as the ANZ has branches in both East Timor and Bali, while Citibank and the Commonwealth Bank both have branches in Bali. You utilize Australian accounts with these banks to meet your living expenses.
As an Australian citizen you are expected to vote, an obligation you fulfil by being registered as a non-resident with the Australian Electoral Commission. You have registered yourself as a non-resident with the Department of Foreign Affairs.
As an Australian medical practitioner, you have indemnity insurance with the Australian medical insurer, MDA National. Since 2006, this policy has had you registered as working overseas.
The national registering authority for doctors, the Australian Health Practitioners Registration Agency (AHPRA), also have you registered as working overseas in East Timor.
As an Australian citizen, you are entitled to Australian health benefits, although you have not used either Medicare or PBS since leaving Australia in 2006.
You have not bought any substantial items for your Australian (Sapphire Beach) residence in the last 6 years. In 2007 you gifted your Australian car, purchased in 2003, to your son, although the car was not formally registered in his name until 2009. This was done because the substantial amounts of time you spent in East Timor and Bali meant that the car was never used.
You still keep a wardrobe of clothing at your Australian residence but these are not considered suitable for the tropical conditions of East Timor and Bali.
You and your spouse have a self managed superannuation fund (SMSF) and a HESTA superannuation fund, both of which are based in Australia. You are a non-resident director of the SMSF and your spouse is a resident director.
You and your spouse have never been Commonwealth Government of Australia employees.
You are more than 16 years of age.
East Timor
Your residence in East Timor is on the basis of a work permit with an indefinite time frame. Furthermore, as part of your contract, [you] are provided with an apartment, which you have lived at since 2007, the address of which is: […]. This residence is a 2 bedroom self-contained apartment within Dili. You do your own grocery shopping, prepares (sic) your own meals, do your own laundry.
You have not applied for a residency visa or citizenship in East Timor.
You pay for many of the household amenities, such as internet and satellite TV access and you have installed the apartment's wireless internet system and satellite TV service.
You have authority to invite anyone you wish to visit or stay, and your spouse and friends do in fact stay over from time to time. Otherwise, although the Dili apartment came furnished, you did purchase a stove, pots, pans, cutlery, crockery, and a clothes caddy and a new fridge. You also have a company car.
You keep your personal belongings at his (sic) Dili address, including: a laptop computer, printer, digital camera, personal library, 100 or so DVD's, a Hi-Fi music system, and a complete wardrobe of clothes.
You have built up a relationship with the community in which you live, having joined Aspen Medical's social club, exercise club, and walking group.
Bali
You have not applied for a residency visa or citizenship in Indonesia.
The legal basis for yours (sic) and your spouse's residence within Bali is the APEC card holder agreement: an agreement which allows the senior business person to both go to and live in Bali as often as they like, without applying for a visa, so long as each visit is no more than two months in duration.
You and your spouse purchased a 55 year lease on the property in Bali in 2007, and then another property, on the same basis, later in the same year. The reason for the purchase of the second property, which was in the same complex as the first property, was that the second property was abandoned only half finished and thus offered a better opportunity to build a house that was truly their (sic) own, while also providing a better investment opportunity. Due to the fact that the second property was only half finished, it required some $100,000 worth of renovations, and took some 8-10 months to complete, at the end of which you sold the first property and moved into the second property. The residential address of the second property, which they (sic) now call home, is: […].
As well as the renovations, the Bali property also required furnishing, to this end the following substantial items were purchased: 2 fridges, 2 king-sized beds, 3 wardrobes, a gas stove, a coffee machine, a Hi-Fi system, a laptop computer, a washing machine, a LCD TV, a sound system, 2 hot water systems, 3 sofas, a lounge suite, 2 lots of outdoor furniture, swimming pool furniture, an outdoor bale, Balinese paintings and cultural artefacts, Balinese wall hangings, Balinese shrines, garden plants, ornaments and outdoor lighting. In addition, the following smaller household items have had to be purchased, and are permanently kept in Bali: bedding, curtains, table fabrics, a complete range of cutlery, locally made crockery, a laptop computer, a small personal library, a DVD collection of 100 items, a digital camera.
You also employ two local people to do housekeeping, keep a pet dog and maintain a local gym membership in Bali.
After the conclusion of your employment with Aspen Medical, you are unsure what you will do. You will divide your time between your residence in Bali (Indonesia) and in Sapphire Beach (Australia). You will make one of them your primary residence or habitual place of abode but you have not yet decided.
THE COMMISSIONER'S RULING
7. The Commissioner formed the view that the ruling request raised the following question:
Are you a resident of Australia for taxation purposes?
8. He answered that question "Yes".
9. The notice of private ruling indicated that the ruling applied to the years ended 30 June 2010, 30 June 2011 and 30 June 2012.
THE CONCEPT OF "RESIDENCE" FOR TAX PURPOSES
10. In relation to individuals, s 6 of the Income Tax Assessment Act 1936 (ITAA 1936) provides as follows:
resident or resident of Australia means:
- (a) a person, other than a company, who resides in Australia and includes a person:
- (i) whose domicile is in Australia, unless the Commissioner is satisfied that his permanent place of abode is outside Australia;
- (ii) who has actually been in Australia, continuously or intermittently, during more than one half of the year of income, unless the Commissioner is satisfied that his usual place of abode is outside Australia and that he does not intend to take up residence in Australia; or
- (iii) who is:
- (A) a member of the superannuation scheme established by deed under the Superannuation Act 1990; or
- (B) an eligible employee for the purposes of the Superannuation Act 1976; or
- (C) the spouse, or a child under 16, of a person covered by sub-subparagraph (A) or (B); …
11. It is common ground that subparagraphs (ii) and (iii) have no application in this case.
12. This matter turns on some or all of the following questions, each of them to be answered in the context of the "scheme" as identified by the Commissioner, and in relation to the relevant years:
- (a) Did Dr Pillay "reside" in Australia?
- (b) Was Dr Pillay's "domicile" in Australia?
- (c) Is the Tribunal satisfied that Dr Pillay's permanent place of abode is outside Australia?
13. If the answer to question (a) is Yes, then the remaining questions do not need to be answered. The objection decision will have to be affirmed.
14. If question (a) is answered No and question (b) is also answered No, then it is not necessary to answer question (c). The objection decision will have to be set aside.
15. If question (a) is answered No and question (b) is answered Yes, then the outcome will depend on the answer to question (c). If the answer to that question is No, then the objection decision will have to be affirmed; if it is Yes, the objection decision will have to be set aside.
QUESTION (a) - DID DR PILLAY "RESIDE" IN AUSTRALIA?
16. Whether a person resides in a particular place is a question of fact.
17. I agree with what Senior Member Walsh said in
Iyengar and Commissioner of Taxation [2011] AATA 856 at [54]:
The term "reside" is not defined in Australian income tax law and consequently it takes its ordinary meaning. The Macquarie Dictionary 5th Ed. (2009) defines "reside" as "to dwell permanently or for a considerable time; have one's abode for a time". Further, the New Shorter Oxford English Dictionary Vol.2 (1993) defines "reside" as meaning "b. Dwell permanently or for a considerable time, have one's regular home in or at a particular place." According to the High Court of Australia in [
Commissioner of Taxation v ] Miller (at
[1946] HCA 23; 73 CLR 93 at 99-100, per Latham CJ), the term "reside" should be given a wide meaning for the purposes of section 6(1)(a) of the ITAA 1936.
18. It should be remembered that the question in this matter, in relation to the relevant years, is not "Did Dr Pillay reside in East Timor?" or "Did Dr Pillay reside in Bali?" but "Did Dr Pillay reside in Australia?"
Dr Pillay's submissions
19. According to Dr Pillay's written submissions, the facts detailed in the ruling request show that Dr Pillay did "dwell permanently or for a considerable time; have a permanent place of abode" in East Timor. Those facts are that:
- (a) He had been living in East Timor since 12 May 2008;
- (b) His contracts with Aspen Medical were not fixed but could be renewed for indefinite periods;
- (c) Since 2006 he was physically present in East Timor for between 9 and 11 months each year;
- (d) He only spent between 6 and 8 weeks in Australia each year;
- (e) His residence in East Timor was on the basis of a work permit with an indefinite time frame;
- (f) He was provided with a self-contained apartment (not a hotel room) in East Timor;
- (g) He did his own grocery shopping, prepared his own meals, did his own laundry and paid for many of the household amenities, such as internet and satellite television, himself;
- (h) He had authority to invite anyone he liked to stay in the apartment and his wife and friends did in fact stay there from time to time.
20. In relation to this aspect of the case, Dr Pillay's representative emphasised in his oral submissions (Transcript, page 22):
The really relevant question was, was Dr Pillay living in Timor for the six years he was in Timor. And I'll say a lot of the other aspects were not relevant to where Dr Pillay actually lives because the question of fact is where did he spend his time, what did he do. And for those six years I'll say he was quite rare - he spent his time - he lived in East Timor. It doesn't matter that he had all the other aspects, other relationships outside East Timor, that's not relevant. What is relevant is what he actually did, and it's not even relevant what his wife did, it's relevant to (sic) what Dr Pillay did. So I would say that the facts make it quite clear that Dr Pillay resided, in the ordinary concepts of the word, in East Timor. It doesn't matter that his wife may have been in Timor or not in Timor. It doesn't matter that he was - he makes this description about having a family home in Australia, it was a question of whether he actually lived in Timor. For six years, living in one place, with an indefinite intention - with no definite intention of ever returning to Australia, I'd say it's pretty conclusive that he was residing in East Timor during that period.
The Commissioner's submissions
21. The Commissioner notes in his written submissions, correctly in my view, that the factors commonly taken into account in determining whether a person resides in a particular place include physical presence; nationality; history of residence and movements; habits and "mode of life"; the frequency, regularity and duration of visits; the purpose of visits to or absences from a country; family and business ties with a country; and the maintenance of a place of abode in a country even when absent from that country. See for example
Iyengar and Commissioner of Taxation [2011] AATA 856 at [61] and following, and
Sneddon and Commissioner of Taxation [2012] AATA 516 at [45].
22. The Commissioner submits that Dr Pillay has maintained a continuity of association with Australia in the relevant years despite being physically absent from Australia for significant periods, and that his circumstances evince an intention to return to Australia and "suggest that the applicant has continued to regard Australia as his home" (written submissions at [18]). The submissions continue:
- 19. The applicant's past and present habits of life, the regularity and length of his visits to Australia and his ties with Australia lead to the conclusion that the applicant continued to be a resident of Australia in the relevant years. The applicant's emotional ties and, to a substantial degree, his assets, are located within Australia. The only matter which led him to East Timor, and which has kept him there for substantial periods, is his employment. The applicant has not asserted, and there is no basis for concluding, that he has developed any definite or fixed intention to retire to Bali, much less to do so at any specified time in the future.
- 20. On the contrary, the highest the matter is put in the applicant's private ruling application is that he "desires to, and is looking into the practical reality and legality of, retiring to Bali on a full-time basis upon reaching retirement age" (T3-21). When pressed for further information as to the applicant's future intentions, the applicant's agent responded as follows (T6-32):
"After the conclusion of his time at Aspen Medical, Dr Pillay is unsure what he will do. He has purchased and renovated a place in Bali, Indonesia, which he essentially has ownership over for the next 55 years - that is, until after his and his wives death [sic]. Dr Pillay also has a place in Sapphire Beach NSW. Dr Pillay definitely intends to spend some time in both locations, although he will spend a significantly larger majority of his time in one of these locations rather than another: that is, he will take up one of these locations as a 'primary' residence, or 'habitual place of abode'. Dr Pillay has begun researching the practicalities of the immigration and residency status that he will have to obtain to effectively make his Bali residence his primary residency and habitual place of abode. In effect, Dr Pillay remains unsure as to what his long term intentions for residency [sic]."
This points away from, rather than in support of, any finding of a firm intention to reside in Bali, or any location outside Australia, permanently. The applicant's submission at [47] that the facts show the applicant "had no intention to return to Australia" is not correct. On the contrary, after his retirement, the applicant "definitely intends to spend some time" in Australia (T6-32).
- 21. Despite the applicant's somewhat limited physical presence in Australia in the relevant income years, it is clear that he not only maintained a place of residence in Australia (namely, the Sapphire Beach home), he also retained a continuity of association with Australia which supports an inference that he intends to return to Australia. Further, he continues to maintain the attitude that the Sapphire Beach home at all material times remained his "family home" (T3-20). He has indicated no intention to dispose of that home. Rather, after retirement, he "definitely intends to spend some time" in Sapphire Beach (T6-32).
- 22. In the relevant years, the applicant has remained a person who "resides" in Australia within the ordinary meaning of that word.
DISCUSSION
23. I note that Dr Pillay's written submissions refer to the "facts" set out in [19] above as having been identified in the ruling request - not the ruling itself. But the only relevant "facts" are those specified in the scheme as identified by the Commissioner in the private ruling. Any "facts" that are included in the ruling request but not reflected in the scheme as identified by the Commissioner do not form part of the "scheme" in respect of which the Commissioner has expressed his opinion in the form of the private ruling.
24. Having said that, and as far as the "facts" set out in [19] are concerned, there is no material difference between what was stated in the ruling request and what was set out by the Commissioner in the notice of private ruling. However, it is no part of the scheme as identified by the Commissioner, and it was no part of the ruling request, that Dr Pillay "had been living in East Timor since 12 May 2008" (my emphasis) (see [19](a) above). It was put more neutrally than that in the private ruling: "You have been employed … in East Timor … from 12 May 2008", "… you have been in East Timor for between 9 and 11 months of each year since 2006" and "… the substantial amounts of time you spent in East Timor and Bali meant that the car was never used" (my emphasis in each case). (Similar language had been used in the ruling request.)
25. I have put the word "facts" in quotation marks to emphasise that neither the Commissioner nor the Tribunal necessarily accepts the accuracy of what is stated as the factual substratum underpinning the scheme:
Cooperative Bulk Handling Ltd v Commissioner of Taxation [2010] FCA 508 at [15] and the cases referred to there. Of course, if the "facts" as stated are not accurate, the Commissioner is not bound by the ruling: s 357-60(1) in Schedule 1 to the TAA.
26. I turn now to the factors identified by the Commissioner as those commonly taken into account in determining whether a person resides in a particular place: see [21] above. In considering these factors, I am mindful that the question for consideration is whether Dr Pillay was residing in Australia during the relevant years, not whether he was residing in East Timor or in Bali. I emphasise once again that when I refer to facts that are identified in the scheme, I am not finding them to be true; I am simply noting what the scheme (as identified by the Commissioner) has to say about them.
Physical presence in Australia
27. Dr Pillay was present in Australia for 6 to 8 weeks in each of the relevant years.
Nationality
28. Dr Pillay is an Australian citizen.
History of residence and movements
29. Dr Pillay's country of origin is South Africa. The scheme does not explain when he first came to Australia. He had been a reservist medical officer with the Australian Defence Forces in East Timor and then in the Middle East.
30. He has been employed in East Timor since 2006. He spends between 9 and 11 months of the year (including, in particular, the relevant years) in East Timor. The remainder of his time is spent in Australia and Bali.
Habits and "mode of life"
31. When in East Timor Dr Pillay stays in a two-bedroom self-contained apartment in Dili. The apartment is supplied by his employer. He does his own grocery shopping, prepares his own meals and does his own laundry. He has installed a wireless internet system and satellite TV system in the apartment. He is free to invite people to visit or stay in the apartment, and family and friends sometimes stay there. He has purchased a number of household items for use in the apartment. He also has many of his personal belongings there, including a laptop computer, printer, digital camera, personal library, DVDs, a music system and a complete wardrobe of clothes. He has a company car.
32. In East Timor he has joined his employer's social club, exercise club and walking group.
33. Dr Pillay and his wife have purchased a 55-year lease on a property in Bali which they have renovated and furnished, and which they call home. Two local people do the housekeeping. They have a pet dog in the Bali home. Dr Pillay has a local gym membership in Bali.
34. Dr Pillay has Australian bank accounts which he uses to meet his living expenses.
35. He is registered as a non-resident with the Australian Electoral Commission. He has also registered himself as a non-resident with the Department of Foreign Affairs. His indemnity insurance policy with an Australian medical insurer has had him registered since 2006 as working overseas. The Australian Health Practitioners Registration Agency has him registered as working overseas in East Timor. He has not used Medicare or the Pharmaceutical Benefits Scheme since 2006.
Frequency, regularity and duration of visits to Australia
36. It is not clear how regularly Dr Pillay visits Australia, but he spends between 6 and 8 weeks here every year.
Purpose of visits to or absences from Australia
37. During his visits to Australia Dr Pillay divides his time between the Sapphire Beach property and visiting his children and grandchild.
38. His absences from Australia are for the purpose of undertaking his employment with Aspen Medical in East Timor.
Family and business ties with Australia
39. There is no suggestion that Dr Pillay has business ties with Australia. He has five adult children and one grandchild, all of whom live in Australia.
Maintenance of a place of abode in Australia
40. Dr Pillay and his wife own a property in Sapphire Beach which is described in the ruling (T7-35) as the "family's home". It was referred to in the ruling request (T3-20, line 8) as the "family home". It is left vacant for most of the year. It appears to be occupied only during the few weeks of the year when Dr Pillay is visiting Australia.
41. Dr Pillay keeps a wardrobe of clothing at the Sapphire Beach property.
CONSIDERATION
42. I do not accept the suggestion made by Dr Pillay's representative in his oral submissions (quoted in [20] above) that this case is determined solely by reference to where Dr Pillay spent his time during the relevant years. The reasoning is more nuanced than "where you spend your time is where you live, and therefore where you reside".
43. In
Hafza v Director-General of Social Security [1985] FCA 164 Wilcox J said:
- [13] There is a plethora of decisions, arising in various contexts but predominantly matrimonial causes and revenue cases, relating to the legal concept of residence. As a general concept residence includes two elements: physical presence in a particular place and the intention to treat that place as home; at least for the time being, not necessarily forever. The concept was explained in a taxation case,
Koitaki Para Rubber Estates Limited v The Federal Commissioner of Taxation [1941] HCA 13; (1941) 64 CLR 241 at p.249, by Williams J:"The place of residence of an individual is determined, not by the situation of some business or property which he is carrying on or owns, but by reference to where he eats and sleeps and has his settled or usual abode. If he maintains a home or homes he resides in the locality or localities where it or they are situate, but he may also reside where he habitually lives even if this is in hotels or on a yacht or some other abode."
- [14] Physical presence and intention will co-incide for most of the time. But few people are always at home. Once a person has established a home in a particular place - even involuntarily: see
Commissioners of Inland Revenue v Lysaght (1928) AC 234 at p 248 and
Keil v Keil (1947) VR 383 - a person does not necessarily cease to be resident there because he or she is physically absent. The test is whether the person has retained a continuity of association with the place -
Levene v Inland Revenue Commissioners [1928] UKHL 1;(1928) AC 217 at p 225 and
Judd v Judd (1957) 75 WN (NSW) 147 at p 149 - together with an intention to return to that place and an attitude that that place remains "home" - see
Norman v Norman (1969) 16 FLR 231 at p. 236. It is important to observe firstly, that a person may simultaneously be a resident in more than one place - see the facts of Lysaght and the reference by Williams J to "a home or homes" - and, secondly, that the application of the general concept of residence to any particular case must depend upon the wording, and underlying purposes, of the particular statute in relation to which the question arises. But, where the general concept is applicable, it is obvious that, as residence of a place in which a person is not physically present depends upon an intention to return and to continue to treat that place as "home", a change of intention may be decisive of the question whether residence in a particular place has been maintained.
44. What is significant in this matter is the "continuity of association" that Dr Pillay has retained with Australia. Although he has been working for an extensive period in East Timor, and although he has had an apartment to stay in while he has been working there, he does not seem to have brought himself to regard East Timor as home. Indeed, as set out in the private ruling, he and his wife regard the Bali property as home, despite the fact that they must have precious little time to spend there together.
45. Superficially, the obvious candidate for the place where Dr Pillay "resides", if not Australia, would be East Timor. However, his connection with that location appears to be one based almost entirely on his employment arrangement. He does not express an intention to remain in East Timor after his employment ends. Rather, he expresses an intention to divide his time between Bali and Sapphire Beach - hardly an indication that his ties with Australia have been broken.
46. Having regard to the factors discussed in [27]-[41] of these reasons, and having regard also to the concepts referred to by Wilcox J in Hafza, I am satisfied that Dr Pillay "resided" in Australia during the relevant years.
47. That conclusion renders it unnecessary to consider whether his "domicile" was in Australia, or whether his "permanent place of abode" was outside Australia.
DECISION
48. Dr Pillay was a "resident of Australia" within s 6 of the ITAA 1936 during the relevant years. The objection decision must be affirmed.
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