What is the 183 day rule?
This is the second statutory test.
Under this test, if you are actually present in Australia for more than half the income year, whether continuously or intermittently, you may be said to have a constructive residence in Australia unless it can be established that:
• your usual place of abode is outside Australia
• you have no intention to take up residence here.
In this test, we must be satisfied that your usual place of abode is outside Australia, whereas the first statutory test (domicile) requires us to be satisfied that your permanent place of abode is outside Australia.
What is a ‘usual place of abode’?
The phrase ‘usual place of abode’ should not be given the same or similar meaning as the phrase ‘permanent place of abode’. The terms ‘usual’ and ‘abode’ should be given their ordinary and natural meanings.
Determining your usual place of abode
Whilst the question of a usual place of abode is a question of fact, generally the phrase is interpreted as the abode customarily or commonly used by you when physically present in a country.
Your place of abode need not be fixed but must exhibit the attributes of a place of residence or a place to live, as contrasted with an overnight, weekly or monthly accommodation of a traveler.
Applying the 183 day test
Your presence in Australia need not be continuous for the purposes of the 183 day test. All the days you are physically present in Australia during the income year will be counted. It is important to note that the 183 day test applies in relation to the year of income, not the calendar year.
Example of a foreign resident
Lars lives in Munich and is granted a 12 month working holiday maker visa. He plans to return to Munich, and resume his career as a carpenter, after his 12 month working holiday in Australia. He takes 12 months leave from his work. He owns a home in Munich which he does not rent out. Lars arrives in August 2007 and has five different jobs whilst he travels around Australia, visiting every capital city during his 12 month stay. He stays in no place for longer than two months. Lars only works for seven of the 12 months he is Australia as he is primarily here to see as much as he can, picking up carpentry work to supplement his funds as he travels. Lars is not an Australian resident under ordinary concepts and although he is in Australia for more than six months in the year ended 30 June 2008, Lars will not satisfy the 183 day test, as his usual place of abode is outside Australia.
Ref: ATO
