If you are planning to work outside of Australia, to avoid paying Australian tax on foreign income, in most cases you will need to prove that you are non resident for Australian tax purposes. With Australia becoming a bigger player in the globalized economy, it is becoming more and more common for people to go and work overseas. And while it may seem exciting, the taxman will always try and get its share of that offshore income. So I thought this week I would give a general overview about what it means for those of you who are currently working overseas, or thinking about going to work overseas.


  • Residency for tax is different to residency for visa purposes
  • If you are an Australian tax resident you generally pay tax on your worldwide income
  • If you are not an Australian tax resident you generally pay tax on your Australian sourced income only (such as rental income)
  • In general, to be considered a non tax Australian resident, you must satisfy the below criteria-
    • You have departed Australia and you do not intend to return for at least 2 years. Note timing is not the conclusive factor for deciding if a taxpayer is a non resident. You need to also consider the below points
    • You bring your family overseas with you
    • You permanently reside in a country which is not Australia
    • You establish a home overseas
    • If you still have Australian sourced income (such as rental income) that also needs to be considered

Tax residency needs to be looked at on a case by case basis and you should always seek professional advice if you are planning on working overseas for an extended period of time.

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