Birchstone Brief for the week ended 1 March 2024

ATO Updates

The ATO has issued the following:

CR 2024/13 – Parks Victoria – Early Retirement Scheme 2024.

Cases

Quy v Commissioner of Taxation [2024] AATA 245 – No Australian tax break for international posting?

The AAT has affirmed that a taxpayer remained a “resident of Australia” as defined in section 6(1) of the ITAA 1936 for the duration of their international posting to the United Arab Emirates, pursuant to the ‘ordinary concepts’ and ‘domicile’ tests of Australian tax residency. In reaching its decision, the Tribunal considered the taxpayer’s numerous ties to Australia, including that the taxpayer:

• continued to own and pay the costs associated with a family home where at least one of his daughters resided rent-free throughout the relevant income years;
• would always use his leave periods to return to Australia to stay with his family in the family home (other than one leave period where the family holidayed outside Australia);
• intended to return to Australia to retire after the expiration of his overseas posting;
• had maintained vehicle registrations and his Australian drivers licence, which allowed him to seamlessly return to using his Australian vehicles whenever he returned to Australia;
• held a visa and accommodation in the UAE which were tied to the length of his employment assignment;
• had failed to demonstrate he had any connection to the UAE other than his employment; and
• had maintained his Australian health insurance throughout the duration of his overseas posting.

As such, the AAT affirmed the relevant objection decisions under review.

Legislation

House recommends passing Bills relating to Administrative Review Tribunal

The House of Representatives Standing Committee on Social Policy and Legal Affairs has recommended passing the following Bills proposing the establishment of the Administrative Review Tribunal to replace the Administrative Appeals Tribunal:

• the Administrative Review Tribunal Bill 2023 (Cth) ; and
• the Administrative Review Tribunal (Consequential and Transitional Provisions No 1) Bill 2023 (Cth) .

The Senate Legal and Constitutional Affairs Legislation Committee is due to report on the above Bills, as well as the ?Administrative Review Tribunal (Consequential and Transitional Provisions No 2) Bill 2024 (Cth) , by 24 July 2024.

Amendments to Stage 3 Tax Cuts pass Commonwealth Parliament

The following Bills, which were covered in the Birchstone Brief for the weeks ended 2 and 9 February 2024 , have both been passed by the Commonwealth Parliament:

• the Treasury Laws Amendment (Cost of Living Tax Cuts Bill) 2024 (Cth) , which will implement the Albanese Government's announced changes to the Stage 3 income tax cuts for individuals originally legislated under the previous Morrison Government; and
• the Treasury Laws Amendment (Cost of Living - Medicare Levy) Bill 2024 (Cth) , which will increase income thresholds relevant to the Medicare levy in line with CPI movements with retrospective effect from the 2023-24 income years.

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