The TRA decided that the individual was solely resident in New Zealand (under the residence tie-breaker provisions in the NZ – Fiji DTA), notwithstanding the length of time spent living and working in Fiji.
This taxmail discusses the decision and the potential wider implications of this ruling.
A key finding was that the taxpayer was found to have a permanent home in NZ, through maintenance of a family home, but not in Fiji (the employer providing housing in Fiji was not considered a permanent abode).
The taxpayer was also found to have his centre of vital interests in NZ (through family and employment ties), but perhaps most surprisingly the TRA concluded that living and working in Fiji for almost five years was not habitual as the taxpayer’s working life was otherwise predominantly in New Zealand.
While the facts of this case are very specific, the decision is a reminder that taxpayers need to take care that they do not leave themselves in a position where they have no objective evidence to rebut Inland Revenue’s assertions.