Sue is qualified engineer and a citizen of the United Kingdom. She has always lived and worked in
her home town of London. Sue was offered a full-time position as an engineer for BHP based in
Perth, Australia for a period of 4 months, being the term of the project. Sue signed the contract of
employment before she left London. Sue is married and with two young children. Sue’s spouse and
children will join her in Perth. Sue’s spouse will not be working while in Perth. Sue moved out of the
family’s apartment in London and placed all their belongings in storage.
As part of the employment contract BHP offered Sue the use of a fully furnished apartment at no
expense during her stay. Sue arrived in Perth on 1 August 2018 and finished working on 30
November 2018. Sue and family stayed on in Australia for a holiday until the end of December 2018
before returning home. Sue lived in the provided apartment for the whole length of her stay.
During the income tax year ended 30 June 2019, Sue earned interest on a bank account held in
London of $1,500 (EUR); salary and wages from her work in London prior to 1 August 2018 $30,000
(EUR); and salary and wage income from her BHP job of $120,000 (AUD). Sue had PAYG withheld of
$34,500 (AUD) from the Australian salary. Sue had deductions of $3,200 (AUD) directly connected to
her employment with BHP
a) Discuss with reference to legislation, case law and/or rulings (where relevant) whether Sue
would be considered a resident of Australia for tax purposes for the income year ended 30
June 2019. Based on this conclusion and discussing the source of income principles, state
which amounts would be included in her assessable income for the year.
b) Calculate Sue’s tax payable for the 2019 Financial year:
1. Based on Sue being a non-resident
2. Based on Sue being a resident. Note use exchange rate for EUR $1 to AUD of $1.59
and provide full details of calculation of tax payable