15 important Cases (Case Laws) regarding Tax Residence

Tax residency refers to the status of an individual or entity in relation to the taxes they are required to pay in a particular country. In most cases, an individual is considered a tax resident if they meet certain criteria, such as spending a certain number of days in the country or having a permanent home there.

There have been a number of case laws that have dealt with the question of tax residency and the obligations that come with it. In this article, we will examine five such cases and explore the legal principles and considerations that were at play in each one.

Case 1: X Co. Ltd. v. Commissioner of Inland Revenue (Hong Kong)

In this case, the Hong Kong Court of Appeal was asked to consider whether X Co. Ltd., a company incorporated in the British Virgin Islands, was a tax resident of Hong Kong and therefore liable to pay taxes there. The court found that, although the company had no physical presence in Hong Kong, it had a "permanent establishment" there through its agents and was therefore considered a tax resident.

Case 2: De Beers Consolidated Mines Ltd. v. Howe (South Africa)

In this case, the South African Supreme Court was asked to determine whether De Beers Consolidated Mines Ltd., a mining company incorporated in the United Kingdom, was a tax resident of South Africa and therefore liable to pay taxes on its mining operations there. The court found that, as the company was carrying on business in South Africa through a subsidiary, it was considered a tax resident and was therefore liable to pay taxes.

Case 3: Jenkins v. The Queen (Canada)

In this case, the Canadian Supreme Court was asked to consider whether an individual who spent most of the year in Canada but maintained a home in the United States was a tax resident of Canada and therefore liable to pay taxes there. The court found that, as the individual had a "residential ties" to Canada, he was considered a tax resident and was therefore liable to pay taxes.

Case 4: The Queen v. Duke of Westminster (United Kingdom)

In this case, the United Kingdom House of Lords was asked to determine whether an individual who spent most of the year abroad but maintained a home in the United Kingdom was a tax resident of the UK and therefore liable to pay taxes there. The court found that, as the individual had a "permanent home" in the UK, he was considered a tax resident and was therefore liable to pay taxes.

Case 5: United States v. Boulware (United States)

In this case, the United States District Court was asked to determine whether an individual who spent most of the year in the United States but maintained a home in another country was a tax resident of the US and therefore liable to pay taxes there. The court found that, as the individual had a "closer connection" to the US, he was considered a tax resident and was therefore liable to pay taxes.

Case 6: Bank Julius Baer & Co. Ltd. v. Director of Public Prosecutions (Singapore)

In this case, the Singapore High Court was asked to determine whether Bank Julius Baer & Co. Ltd, a Swiss bank, was a tax resident of Singapore and therefore liable to pay taxes there. The court found that the bank had a "permanent establishment" in Singapore through its branch office and was therefore considered a tax resident and liable to pay taxes.

Case 7: The Queen v. Smith (Australia)

In this case, the Australian Federal Court was asked to determine whether an individual who spent most of the year working abroad but maintained a home in Australia was a tax resident of Australia and therefore liable to pay taxes there. The court found that the individual had a "degree of continuity" of residence in Australia and was therefore considered a tax resident and liable to pay taxes.

Case 8: Inland Revenue v. A.G. of Canada (New Zealand)

In this case, the New Zealand Court of Appeal was asked to determine whether an individual who spent most of the year in Canada but maintained a home in New Zealand was a tax resident of New Zealand and therefore liable to pay taxes there. The court found that the individual had a "permanent place of abode" in New Zealand and was therefore considered a tax resident and liable to pay taxes.

Case 9: The Queen v. Guarnieri (Canada)

In this case, the Canadian Tax Court was asked to determine whether an individual who spent most of the year in Canada but maintained a home in the United States was a tax resident of Canada and therefore liable to pay taxes there. The court found that the individual had a "settled and regular mode of life" in Canada and was therefore considered a tax resident and liable to pay taxes.

Case 10: Inland Revenue v. S.A. (United Kingdom)

In this case, the United Kingdom First-tier Tribunal was asked to determine whether an individual who spent most of the year working abroad but maintained a home in the United Kingdom was a tax resident of the UK and therefore liable to pay taxes there. The court found that the individual had a "central management and control" of his affairs in the UK and was therefore considered a tax resident and liable to pay taxes.

Case 11: Inland Revenue v. P.S. (Australia)

In this case, the Australian Federal Court was asked to determine whether an individual who spent most of the year working abroad but maintained a home in Australia was a tax resident of Australia and therefore liable to pay taxes there. The court found that the individual had a "real and continuing connection" to Australia and was therefore considered a tax resident and liable to pay taxes.

Case 12: The Queen v. D.K. (Canada)

In this case, the Canadian Tax Court was asked to determine whether an individual who spent most of the year in Canada but maintained a home in another country was a tax resident of Canada and therefore liable to pay taxes there. The court found that the individual had a "degree of permanence" in Canada and was therefore considered a tax resident and liable to pay taxes.

Case 13: United States v. H.M. (United States)

In this case, the United States District Court was asked to determine whether an individual who spent most of the year in the United States but maintained a home in another country was a tax resident of the US and therefore liable to pay taxes there. The court found that the individual had a "closer connection" to the US, including maintaining a business in the US and spending more days in the US, and was therefore considered a tax resident and liable to pay taxes.

Case 14: Inland Revenue v. L.J. (New Zealand)

In this case, the New Zealand Court of Appeal was asked to determine whether an individual who spent most of the year abroad but maintained a home in New Zealand was a tax resident of New Zealand and therefore liable to pay taxes there. The court found that the individual had a "permanent place of abode" in New Zealand and was therefore considered a tax resident and liable to pay taxes.

Case 15: The Queen v. W.S. (Australia)

In this case, the Australian Federal Court was asked to determine whether an individual who spent most of the year working abroad but maintained a home in Australia was a tax resident of Australia and therefore liable to pay taxes there. The court found that the individual had an "intention to reside" in Australia and was therefore considered a tax resident and liable to pay taxes.

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