Australia Tax Residency Tester

About the Australia Tax Residency Tester

Work out whether you are likely to be an Australian resident for tax purposes for an income year (1 July to 30 June), the way the ATO reads the four tests in subsection 6(1) of the Income Tax Assessment Act 1936: the resides test (ordinary concepts), the domicile test, the 183-day test and the Commonwealth superannuation fund test. You are a resident if you meet any one of them, and a foreign resident only if you meet none (TR 2023/1, paragraphs 3 and 15).

Answer questions about your days in Australia, your visa, why you are here (or why you left), your home, family, work and plans. The tester goes through each test, says which one decides it and why, flags the working holiday maker rates and the non-discrimination countries, and compares the tax on your income at the resident, part-year, foreign resident and working holiday maker rates. Nothing you type leaves your browser.

Without a pass the page gives a free preview of your own result: your likely residency status and the test that decides it, with the first rows of each table; a Pro pass opens every test’s reasons, all the factors weighed, the tax comparison, the report download and printing.

The four tests

• Resides test (ordinary concepts): do you live in Australia in the ordinary sense — is your presence settled rather than temporary? The ATO weighs your physical presence, your intention or purpose, your behaviour here, family and work ties, assets, and social and living arrangements, with no single factor deciding (TR 2023/1, paragraphs 17–54). Going overseas temporarily without setting up a permanent home elsewhere does not end it.
• Domicile test: if your domicile is Australia (by birth or by settling here permanently, until you make another country your permanent home), you are a resident unless your permanent place of abode is outside Australia — you have definitely abandoned living here and live permanently in a particular country overseas. As a rule of thumb the ATO treats 2 years as substantial: a stay planned for less is unlikely to give you a permanent place of abode overseas (paragraphs 55–82).
• 183-day test: in Australia for more than half the income year — 183 days, or 184 in a year with 29 February — continuously or not, you are a resident unless your usual place of abode is outside Australia and you do not intend to take up residence here (paragraphs 83–95).
• Commonwealth superannuation fund test: active members of the PSS or CSS (Australian Government employees, for example at posts abroad), their spouses and their children under 16 are residents (paragraphs 96–97).

Working holiday makers

If you hold a 417 (Working Holiday) or 462 (Work and Holiday) visa, your working holiday income is taxed at the working holiday maker rates — 15% up to $45,000, then 30%, 37% and 45% — whether you are a resident or not (ATO; rates). The exception: a resident from a country whose tax treaty has a non-discrimination article that does not exclude these rates — Chile, Finland, Germany, Israel, Japan, Norway, Turkey and the United Kingdom — pays the lower of the tax of a resident Australian national and the working holiday maker tax; Iceland’s treaty excludes them (ATO). Most working holiday makers are foreign residents: on a working holiday you are a visitor, and you become a resident only when your purpose and way of life change, for example with sponsorship and a work visa to stay (ATO; TR 2023/1 paragraphs 102–104). A working holiday maker who is a resident may also have to pay the Medicare levy (ATO), so the tester’s working holiday maker row then includes it.

Part-year and temporary residents

If you became or stopped being a resident during the income year, your tax-free threshold is $13,464 plus $4,736 × the months you were a resident ÷ 12, counting the month you arrived or left, and the resident rates apply to all your taxable income (ATO); the tester adds that row to the tax comparison when you enter the date. With a temporary visa you are usually also a temporary resident: you declare your Australian income and gains on taxable Australian property, and most foreign income is not taxed here — unless you or your spouse is an Australian citizen or permanent resident (ATO).

How the tester weighs the resides test

The ruling gives factors and examples, not a formula. The tester counts each answer toward or away from residing, in the direction and roughly the strength the ruling’s examples give it — a settled purpose such as migrating, a long contract or a long course points strongly toward residing; a holiday points strongly away; a home, family, work and routine here point toward it; a home and family overseas point away a little, because a connection to another country does not cancel one to Australia (paragraph 24). It calls the test met or not met only when the answers point clearly one way, and “unclear” otherwise. A working holiday maker or visitor whose purpose is a holiday is a visitor whatever else (paragraphs 34 and 102–104). For someone who left Australia, the 183-day test reads the intention to take up residence here again from the plan to return: back within 2 years, or no permanent home abroad, and the proviso does not apply. Every factor is listed with the result, so you can see how it was read.

Official sources

• ATO: Taxation Ruling TR 2023/1, residency tests for individuals
• ATO: Australian resident for tax purposes
• ATO: Foreign and temporary residents
• ATO: Work out your residency status for tax purposes
• ATO: Working holiday makers and Taxation of Australian resident WHMs from NDA countries
• ATO: Tax rates for Australian residents, foreign residents and working holiday makers
• ATO: Tax-free threshold for newcomers to Australia

Limitations

• A guide to the ATO’s reading of the tests, not a decision: residency turns on all your facts, and in a borderline case only the ATO (with a private ruling) or a court can settle it. Under self-assessment you must take a reasonable view of how the Commissioner would see your case.
• Dual residency and the tie-breaker rules of a tax treaty are not worked out: a treaty can give another country the first right to tax some of your income even while you are an Australian resident.
• The days are counted as you enter them. Count every day you were in Australia, a part day as a whole day.
• The tax comparison is for a single person: the low income tax offset and the Medicare levy only, with no Medicare levy surcharge, study loan or other offsets, and all the income treated as taxable in Australia (a foreign resident is taxed only on Australian income).
• For individuals only: the residency of companies, trusts and super funds follows other rules.

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