Commissioner of Taxation v Addy [2020] FCAFC 135

Appeal from: Addy v Commissioner of Taxation [2019] FCA 1768

TAXATION – Australia and United Kingdom double taxation treaty Art 25 – non-discrimination clause – working holiday makers – where respondent a citizen of United Kingdom and holder of a working holiday visa – where respondent taxed at working holiday maker rate in Pt III of Sch 7 of the Income Tax Rates Act 1986 (Cth) on income earned in Australia – whether working holiday maker rate infringes Art 25 of Australia and United Kingdom double taxation treaty – construction of non-discrimination clause – whether respondent subjected to more burdensome taxation by reason of her nationality – taxation rate based on visa held rather than nationality – appeal allowed

TAXATION – whether respondent a resident of Australia for tax purposes – definition of “resident” in s 6 of Income Tax Assessment Act 1936 (Cth) – respondent not a resident under “ordinary concepts test” – application of “183 day test” – whether Court can substitute own state of satisfaction in place of Commissioner’s state of satisfaction as to “usual place of abode” outside Australia – role of the Court limited to determining whether Commissioner had lawfully attained state of satisfaction – Kolotex Pty Ltd v Commissioner of Taxation (1975) 132 CLR 535 considered – on facts of case Commissioner had not reached state of satisfaction – respondent was a resident by application of objective element of 183 day test

Full decision here