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ATO, Compliance & Regulation

ATO better defines residency rules

The ATO has recently clarified its position on residency rules applied to an Australian superannuation fund.

The matter at hand was whether a super fund would lose its Australian residency status if it paid a pension to a non-resident member. The query was addressed in newly issued private binding ruling 1012821532232.

Specialist superannuation law firm Townsends Business and Corporate Lawyers reviewed the ATO’s response and said: “The ruling reviews the law and the ATO’s guideline, Tax Ruling 2008/9, about what constitutes an Australian super fund and the need for the fund to pass three important tests.

“[The tests are whether] the fund was set up in Australia or has Australian assets, the fund’s central management and control is in Australia, and the fund passes the so-called ‘active member’ test.

“The ruling confirms that as long as these three tests are met, the fund will remain an Australian superannuation fund and will not lose that status just because it pays a pension to a non-member resident”.

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