John Bond is a senior executive of an Australian brewing company (AusLarger) and an Australian resident for tax purposes. During the 2020-21 tax year the company decided to attempt to expand into the South-East Asian market and Bond was posted to Singapore to take responsibility. Bond expects to live in Singapore for a period of between one and three years and believes it would be advantageous to be regarded as a non-resident for Australian tax purposes.

Bonds assets in Australia comprise, a home in Brisbane, a unit in Noosa which is used for family holidays in September each year and is available for rental for the rest of the year, a further investment property in Cains, a superannuation policy with AMP, listed company shares, bank account and an Australian Golf Club membership.

Bond’s wife Jenny and young daughter Claire, will accompany him to Singapore, but his 19-year old son James will remain in Australia and continue to reside in the Brisbane home at below market rental. James will occupy the Noosa unit during September 2020 as usual.

Bond expects to return to the head office in Australia from time to time for business reasons, possibly five or six times a year for periods of between one and two weeks.

Required:

Discuss John Bond’s residency status and the consequential source implications for the relevant 2020/2021 tax year and beyond making reference to relevant case law and sections of the ITAA legislation. Explain also what he could do to increase the chance of being considered a non-resident.

Answer rating: 100% (QA)

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