How is residency defined for tax purposes in the Green Book?

Residency for tax purposes in the Green Book is defined by a person's permanent establishment in Australia. This means that an individual's residency is determined by the nature and permanence of their ties to Australia, which includes their physical presence and connections to the country such as location of their home or regularly engaged activities.

This framework is critical because it establishes who qualifies as a resident taxpayer subject to the Australian tax law, impacting the individual's tax obligations on their worldwide income. Such a definition goes beyond mere physical presence to consider a more stable and ongoing connection to the country, ensuring that individuals who have made Australia their home are adequately captured within the tax system.

Other definitions, such as those based on age, bank account locations, or employment status, do not accurately reflect the comprehensive criteria used for tax residency determination. Age alone does not imply residency; similarly, where bank accounts are held and employment status are irrelevant to the core concept of a permanent establishment, which directly ties an individual's personal and financial affairs to Australia.