Tax
Four tests, one answer, and what each answer costs you
Australian tax residency is decided by four separate tests, three of which are pure judgement. The 183 day rule is one of them and it is the one everybody quotes. Getting the answer wrong is expensive in a way that shows up years later.
The 183 day rule is one test out of four. The other three never look at a calendar.
Australian tax residency is defined in section 6(1) of the Income Tax Assessment Act 1936 and turns on four tests: the resides test, the domicile and permanent place of abode test, the 183 day test, and the Commonwealth superannuation test. Satisfying any one of them makes you a resident. Being in Australia for fewer than 183 days satisfies none of them — which is why the rule quoted on every expat forum can only ever make you a resident and can never make you a non-resident.
The statutory replacement — the bright-line test with its 45 day factor test — was announced in 2021 and has never been legislated. Until it is, three of the four tests are judgement calls about domicile, intention, family and where you actually live, and Australia runs on self-assessment: you take a position, and it is reviewed later, or not at all.
On the day residency ends, everything you own that is not Australian real property is treated as sold at market value under CGT event I1, and the gain is taxed. No sale, no cash, and it has been law since 1997.
Most people leaving Australia have never heard of it.
What it works out
- All four tests, separately. Which one is doing the work, and how close the answer is — because a position that turns on one factor is a different risk from one that does not.
- The judgement scored one factor at a time, with the weighting published, rather than a verdict with no working.
- Both outcomes priced on the same income. Worldwide income at resident rates with the $18,200 threshold and the 2% Medicare levy, against Australian sourced income at the foreign resident rate of 30% from the first dollar, with no threshold and no levy.
- The part-year cases. A part-year threshold of $13,464 plus $394.67 a month, which is what actually applies in the year you leave or arrive.
- Withholding and CGT as a non-resident. 10% on interest, 30% on unfranked dividends, foreign resident capital gains withholding at 15% on property, and the loss of the CGT discount on gains accrued after 8 May 2012.
What the full report adds
- The CGT event I1 exposure, quantified, along with the section 104-165 choice to defer it — which is a real election with real consequences and a deadline.
- Dual residency and the treaty tie-breaker. Two countries can both consider you resident; more than 40 treaties resolve it, and which article applies changes the answer.
- The temporary resident exemption, which for the right visa is worth more than everything else on this page combined.
- Every income year, as many times as you like. Residency is decided one year at a time, so the report is built to be re-run for the year before and the year after.
What it will not do
It does not give tax advice and it does not decide your residency — nothing can, short of a private ruling or a court. Three of the four tests are judgement, and the report says which way each factor points and how heavily, rather than pretending to certainty it does not have. Where several years are already open or the position is finely balanced, a registered tax agent is the right next step, and a private ruling is free and binding.
We never ask for your tax file number. Everything here runs on the rates for 2026-27, effective 1 July 2026, the 2026-27 income year.
What people ask before they run it
How do I know if I am still an Australian tax resident?
There is no single answer and no form to fill in. You are an Australian tax resident if you meet any one of four tests: you reside here in the ordinary sense of the word, your domicile is Australian and you have not set up a permanent place of abode overseas, you were here for 183 days or more, or you are a member of a Commonwealth superannuation scheme. Meeting one is enough. This calculator applies all four to your own facts and tells you which one is doing the work.
What does it cost to get Australian tax residency wrong?
An Australian resident pays Australian tax on worldwide income and keeps the $18,200 tax-free threshold. A foreign resident pays 30% from the first dollar of Australian sourced income and no Australian tax on foreign income. On a foreign salary of $250,000 that difference runs into six figures a year, and it repeats for every year of the posting.
Is the 183 day rule all that matters?
No, and this is the most expensive misunderstanding on the subject. Being here 183 days or more can make you a resident, but being here fewer than 183 days does not make you a foreign resident. The resides test and the domicile test both work without any day count at all, which is how somebody who spent three weeks in Australia can still be assessed on their worldwide income.
What is CGT event I1?
On the day you stop being an Australian tax resident, the law treats you as having sold everything that is not taxable Australian property — shares, managed funds, cryptocurrency, overseas property — at its market value that day, and taxes the gain. You can choose instead to keep those assets inside the Australian tax net and pay later. The report prices both.
Do you give tax advice?
No. This is an information service: it applies the published tests and rates to the facts you enter and shows what they produce, with every working visible. It ranks outcomes on one stated arithmetic measure and does not recommend one. Residency is a question of fact decided on your whole circumstances, and settled with certainty only by a private ruling or by a court.
Everything on Resident or Not
The estimate is free, and it is a real one.
Applies the four Australian tax residency tests in section 6(1) of the Income Tax Assessment Act 1936 — the resides test, the domicile and permanent place of abode test, the 183 day test and the Commonwealth superannuation test — to one person's own facts, then prices every outcome those facts could produce: worldwide income against Australian sourced income, the tax-free threshold in full, apportioned or lost, the Medicare levy, the temporary resident exemption, and the capital gains tax that falls due on the day residency ends.
Start the Resident or Not calculator
