16 May 1975 Income Tax Severed Letter

Please note that the following document, although believed to be correct at the time of issue, may not represent the current position of the CRA.
Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle de l'ARC.

May 16, 1975

INDEXED

Dear Sir:

This will reply to your litter of April 20, 1975 concerning your eligibility for exemption from Australian income tax, as a visiting teacher from Canada. In particular, you request confirmation that you axe considered to be a resident of Canada during your stay in Australia.

We Lust point out that the term "resident of Canada" has a special technical meaning for income tax purposes, in addition to its ordinary, everyday meaning. Liability to income tax in Canada is based on residence and a resident of Canada is taxable on his world income, including income arising outside Canada.

Where a taxpayer leaves Canada for an extended period, U s residential status for income tax purposes depends primarily on whether or not he maintains a residence in Canada during his absence or has a home available to bin. The enclosed Bulletin explains the factors that are considered in determining the residential status of a taxpayer, who leaves Canada temporarily. A taxpayer, who is considered to be a continuing resident, is required to file a Canadian income tax return and to report his world income for the year.

If you have reason to believe that you should. be considered a continuing resident of Canada during your stay in Australia, we suggest that you write to your District Taxation Office, where your file is maintained, for o ruling to this effect.

You may be interested in the wording of Article XII of the Canada Australia Income Tax Agreement, which is the basis of the visiting teacher's exemptions

Where a professor or teacher, who is a resident of me of the Contracting states, is temporarily present in the other Contracting State for the purpose of teaching during a period not exceeding two years at a university, collage, school or other educational institution in that other Contracting State, remuneration derived by his for so teaching for that period *bell be exempt from tax by that other Contracting State.

We must point out that your eligibility for exemption is a matter for the decision of the Au3tralian to authorities. However, under this Article we understand that they require evidence of a visiting teacher's liability to income tax in his home country before granting an exemption from Australian income tax.

Yours truly,

for Director Rulings Division Legislation Branch

NMS/mg AIRMAIL

580-14

Encl.