DT2702 - DT: Australia: old agreement, Article 3: Residence

This Agreement applied up to 31st March 2004 for UK Corporation Tax, 5th April 2004 for UK income tax and 30th June 2004 for Australian tax. For later periods the new Agreement applies. This can be accessed via the page Tax Treaties – in force http://www.hmrc.gov.uk/international/in_force.htm.

(3)(1) For the purposes of this Agreement-

(a) the term 'Australian company' means any company which being a resident of Australia - (i) is incorporated in Australia and has its centre of administrative or practical management in Australia whether or not any person outside Australia exercises or is capable of exercising any overriding control or direction of the company or of its policy or affairs in any way whatsoever; or (ii) is managed and controlled in Australia;

(b) the term 'United Kingdom company' means any company which is managed and controlled in the United Kingdom and which is not an Australian company;

(c) the term 'United Kingdom resident' means any United Kingdom company and any person (other than a company) who is resident in the United Kingdom but the term does not include any individual, not being ordinarily resident in the United Kingdom, who is liable to tax in the United Kingdom only if he derives income from sources therein; and

(d) the term 'Australian resident' means any Australian company and any other person (other than a United Kingdom company) who is a resident of Australia but the term does not include any individual, not being ordinarily resident in Australia, who is liable to tax in Australia only if he derives income from sources therein.

(2) Where by reason of the provisions of paragraph (1) of this Article an individual is both a United Kingdom resident and an Australian resident-

(a) he shall be treated solely as a United Kingdom resident-

(i) if he has a permanent home available to him in the United Kingdom and has not a permanent home available to him in Australia;
(ii) if sub-paragraph (a) (i) of this paragraph is not applicable but he has an habitual abode in the United Kingdom and has not an habitual abode in Australia;
(iii) if neither sub-paragraph (a) (i) nor sub-paragraph (a) (ii) of this paragraph is applicable but the territory with which his personal and economic relations are closest is the United Kingdom;

(b) he shall be treated solely as an Australian resident-

(i) if he has a permanent home available to him in Australia and has not a permanent home available to him in the United Kingdom;
(ii) if sub-paragraph (b) (i) of this paragraph is not applicable but he has an habitual abode in Australia and has not an habitual abode in the United Kingdom;
(iii) if neither sub-paragraph (b) (i) nor sub-paragraph (b) (ii) of this paragraph is applicable but the territory with which his personal and economic relations are closest is Australia.

(3) Where by reason of the provisions of paragraph (1) of this Article a person other than an individual is both a United Kingdom resident and an Australian resident -

(a) it shall be treated solely as a United Kingdom resident if it is managed and controlled in the United Kingdom;

(b) it shall be treated solely as an Australian resident if it is managed and controlled in Australia.

(4) The terms 'resident of one of the territories' and 'resident of the other territory' mean a person who is a United Kingdom resident or a person who is an Australian resident as the context requires.

(5) The terms 'United Kingdom enterprise' and 'Australian enterprise' mean respectively an industrial or commercial enterprise or undertaking carried on by a United Kingdom resident and an industrial or commercial enterprise or undertaking carried on by an Australian resident, and the terms 'enterprise of one of the territories' and 'enterprise of the other territory' mean a United Kingdom enterprise or an Australian enterprise, as the context requires.