Essay LAWS 20060: Rachel Case Study – Law Assignment Help

Assignment Task:

PART A: Case study 

Rachel is a 32 year old CEO. She was born in Canada, and lived there until 2006, when she moved to Australia with her 2 young sons and her husband. Her family arrived in Australia on 1 July 2006 and settled in Brisbane.  Her sons attended the local primary school. Upon their arrival, Rachel and her husband bought a home jointly in Brisbane and opened a joint National Australia Bank account. It is into this account that Rachel’s salary is deposited whilst she was working in Australia. Her husband didn’t get a job in Australia but was a stay at home dad. Rachel also maintained a bank account in Canada, where she still has significant savings. 

In early 2018, Rachel decided that Brisbane was too hot; and that it wasn’t the place she wanted to raise her children. She also missed her extended family and had little job satisfaction. As such, she secured a job with a Canadian company, which involved significant travel within Canada. She left Australia on the 1st of July 2018 to take up this position. It was decided that her husband and sons would remain in Australia for at least another 6 months whilst the children finished the school year. Her husband and her sons remained in the house that was jointly owned by Rachel and her husband. In Canada, Rachel stayed with her mother and father in her childhood home whilst she was not travelling for work. Whilst she was travelling for work, she stayed in hotels. She spent approximately 20 nights a month travelling. She returned to Australia for a brief visit with her family for the month of December 2018, at which time she helped her husband list their home for sale and made arrangements for the rest of her family to return to Canada. On 1 January 2019, she once again left Australia, this time with her husband and children. When they arrived back in Canada, they purchased a new home and settled back into Canadian life.

Rachel seeks your advice as to whether she will be considered a resident of Australia for tax purposes for the whole, or part of the 2019 income tax year. In your answer, you should discuss each of the tests of residency, and refer to any relevant taxation rules and/or case law. Please ignore the implications of the Double Tax Agreement between Australia and Canada. 

Required

With reference to relevant legislation, case law, and ATO guidance materials, prepare a memo to your manager addressing the following:

1. whether Julie might be able to object to any of the above amendments made by the Commissioner. You should highlight the strengths and weaknesses of any argument you are making. Note that if you do not think that there are grounds for objection in relation to any of the amendments, you must clearly outline why you believe this is the case.  

For example, if you were told that Julie had claimed the cost of a speeding fine as a deduction in her original return, and the Commissioner had disallowed this expense, your explanation would be “Julie should not object to the disallowance of the speeding fine. This is because s26-5 ITAA 1997 expressly excludes the deduction of fines”. 

2. The objection process, and any relevant time frames of which Julie should be aware. 
3. How Julie should include the administrative fees charged by the property manager of her rental property in her 2018 income tax return.