Australia: Tax residency of Australian expats

Last Updated: 5 June 2019
Article by Carlos Gouveia

In brief - "Permanent place of abode" can also refer to a town or country not just a specific dwelling, Court finds

In Harding v Commissioner of Taxation [2019] FCAFC 29 an Australian expatriate was found not to be a resident of Australia while living in temporary accommodation overseas and despite maintaining many personal and financial connections with Australia, because he abandoned his Australian residence in a permanent way.

The issue for the Full Federal Court was whether Harding was a resident of Australia for the year of income ended 30 June 2011.

Courts agree that appellant did not reside in Australia but differ on determining his permanent place of abode

A resident of Australia is a person who resides in Australia and includes a person whose domicile is in Australia, unless the Commissioner is satisfied that the person's permanent place of abode is outside Australia.

The primary judge found that Harding was a resident of Australia in the 2011 year because while he did not reside in Australia, he did not establish a permanent place of abode outside Australia. Harding lived in temporary accommodation in Bahrain as his intention was to acquire a house once his family moved there. This was not enough to establish a permanent place of abode outside Australia.

On appeal the Full Federal Court agreed that Harding did not reside in Australia but found that Harding's permanent place of abode was Bahrain.

The facts were:

  • Harding was born in Australia and was an Australian citizen. He left Australia at a relatively young age, married his first wife in the United Kingdom and lived and worked in Saudi Arabia for 16 years
  • In 2001 the security situation in Saudi Arabia worsened and caused Mrs Harding and the children to return to the United Kingdom for two years
  • Mrs Harding and the children then returned to Saudi Arabia but soon after Harding and his family decided to relocate to Australia and they built a house at the Sunshine Coast. Mrs Harding and the children moved in to the house in June 2004
  • Harding remained in Saudi Arabia until 2006 and then joined his family at the house at the Sunshine Coast. It was the family's intention to stay in Australia temporarily until the security situation in the Middle East improved
  • Harding remained in Australia until 2009 when he accepted an offer to work in Saudi Arabia. He left Australia intending to leave permanently or at least indefinitely to live and work in the Middle East
  • Mrs Harding and the children remained in the house at the Sunshine Coast but it was intended that Mrs Harding and the youngest child would join Harding in the Middle East at the end of 2011
  • Harding chose to live in Bahrain and commute to Saudi Arabia. Initially he leased a fully furnished 2 bedroom apartment so his family could visit. The apartment was intended to be a temporary residence until he acquired a house for his family
  • Mrs Harding changed her mind about joining Harding in Bahrain and the marriage broke down
  • Harding moved to other fully furnished apartments as a result of the marriage break down and later commenced a new relationship, which subsequently broke down because Harding's new partner did not want to join Harding in Oman when he commenced a new job
  • Until the marriage break up, Harding regularly visited his family at the house at the Sunshine Coast and in the 2011 year he visited them for over 91 days. He indicated on his passenger cards that he was an Australian resident
  • Harding's other connections with Australia included holding an Australian passport, using the house at the Sunshine Coast as his postal address, certain investments, a bank account, medicare and private health insurance, driver's licence and superannuation.

Purpose of definition of resident and meaning of "permanent place" considered by the Full Federal Court

In a victory for expatriates, the Full Federal Court held that the primary judge's view of permanent place of abode was too narrow having regard to the purpose of the definition of resident, which was that a person domiciled in Australia was not to be subject to income tax once they have abandoned in a permanent way their Australian residence.

It could not have been Parliament's intention to require a person to be permanently located in a particular dwelling to not be subject to income tax. If that had been Parliament's intention it would have used the phrase permanent abode rather than permanent place of abode. The word place in the context of the phrase outside Australia can mean a town, state or country in which a person is physically residing in permanently.

The Full Federal Court rejected the proposition that it does not matter if the person is not permanently in one country, but moves between foreign countries. The words permanent place require identification of a country in which the person is living in permanently.

Commissioner's Notice of Contention rejected, applies to appeal to High Court

The main judgment of the court was given by Davies and Steward JJ who agreed with the opinion of the primary judge that the circumstances of this case were most rare, exceptional and extraordinary.

In a separate judgment, Logan J provided advisers and the Commissioner with some salient points, namely that determination of a person's residence is a question of fact and degree and it is not appropriate to seize on a particular fact as decisive or to apply particular facts found decisive in the different circumstances of previous court decisions as if they were principles of law.

Each of these comments potentially invites the Commissioner to adopt its common approach in relation to unfavourable court decisions, which is to issue a decision impact statement which states that the decision should be confined to its own facts.

The Commissioner has applied for special leave to appeal to the High Court.

Carlos Gouveia
Corporate advisory
Colin Biggers & Paisley

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

Similar Articles
Relevancy Powered by MondaqAI
Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Related Topics
Similar Articles
Relevancy Powered by MondaqAI
Related Articles
Up-coming Events Search
Font Size:
Mondaq on Twitter
Mondaq Free Registration
Gain access to Mondaq global archive of over 375,000 articles covering 200 countries with a personalised News Alert and automatic login on this device.
Mondaq News Alert (some suggested topics and region)
Select Topics
Registration (please scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of

To Use you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions