Digital Nomad
Digital Nomads & Australian Tax Residency: Know Your Obligations
For remote workers and digital nomads, subtle facts like visa type, travel pattern, and asset location can mean the difference between being an Australian tax resident or not under TR 2023/1.
By NomadicTax Research Team • 5-8 min read • August 26, 2026
## Introduction
More people now live as digital nomads—working for clients abroad while travelling constantly. But even if you're physically out of Australia, **your tax residency status** can have significant impacts: on your taxable income, CGT obligations, access to Medicare, and contributions to and withdrawals from superannuation. ATO’s recent guidance under _Taxation Ruling TR 2023/1 Income tax: residency tests for individuals_ lays out how residency is determined. ([ato.gov.au](https://www.ato.gov.au/law/view/pdf?DocId=TXR%2FTR20231%2FNAT%2FATO%2F00001&filename=law%2Fview%2Fpdf%2Fpbr%2Ftr2023-001.pdf&utm_source=openai))
## Australia’s Residency Tests Under TR 2023/1
The ruling sets out four tests; you only need to satisfy **one** to be considered an Australian tax resident:
- **Resides (ordinary concepts) test** – based on where you live, your activities, family, and social ties.
- **Domicile and permanent place of abode test** – your “home base” and whether your permanent abode is outside Australia.
- **183-day test** – if you've been in Australia more than half the year unless your usual abode is overseas and no intent to take up residence.
- **Commonwealth superannuation fund test** – for members of certain super funds under the SG legislation (eg government employees abroad). ([ato.gov.au](https://www.ato.gov.au/law/view/pdf?DocId=TXR%2FTR20231%2FNAT%2FATO%2F00001&filename=law%2Fview%2Fpdf%2Fpbr%2Ftr2023-001.pdf&utm_source=openai))
## Digital Nomad Scenarios & Outcomes
| Scenario | Key Facts | Likely Tax Residency Under TR 2023/1 |
|---|---|---|
| Constant traveller, never home to Australia for long periods, few assets & family abroad | Mostly abroad, overseas home still available | Possibly **non-resident** under several tests; domicile test might fail if no intent to return / no Australian home base. |
| Working overseas, return visits home every few months, family & assets in Australia | Strong connections | Likely **resident** under ordinary concepts or domicile test—even if physically out more than 183 days. |
| Digital nomad working for overseas clients, spending half the year in Australia per year | 200+ days in Australia, but intent is for travel purpose only | Could meet the **183-day test**, but disprove by showing usual abode overseas & no intent to reside permanently. |
## Implications of Resident vs Non-Resident Status
**Resident status** means:
- worldwide income must be declared (foreign income included)
- access to tax-free threshold, offset on foreign tax paid
- liability for **capital gains tax** on overseas assets if brought to Australia or disposed of while resident
- pay **Medicare levy**
- contributions to super may be required or expected, and in some cases compulsory depending on status.
**Non-resident status** means:
- only Australian-source income is taxed
- no tax-free threshold, generally higher withholding rates
- may not be liable for Medicare levy
- limited access to certain offsets or deductions
## Case Study: Anna, the Software Developer Nomad
Anna is an Australian citizen who has worked remotely while travelling between Thailand and Indonesia. She visits Australia every 9 months to see family and has a home in Brisbane she still owns but rents out while overseas. She retains a bank account, car, and some personal belongings back home. Under TR 2023/1:
- **Resides test**: probably yes—family, assets, routines point back to Australia.
- **Domicile test**: yes—her domicile is Australia and her permanent place of abode might still be deemed as Australia if the overseas home is temporary.
- **183-day test**: maybe yes depending on time in Australia, though this test could be negated if she’s proving usual abode overseas.
Conclusion: likely a resident for tax purposes. She must report foreign income, pay CGT on worldwide income, and ensure super obligations meet resident expectations.
## Tips & Actionable Advice for Digital Nomads
- **Track your days carefully**: maintain detailed travel logs, entry/exit dates.
- **Keep ties documented**: residential address, family, bank accounts, regular visits—anything showing intent or domicile, or contrary.
- **Understand CGT implications**: non-residents may have extra tax if selling Australian real property; residents may need to report capital gains overseas.
- **Record when you stop being a resident**: if intending to sever, notify the ATO and document the change.
- **Get advice**: situations are case-specific. Use the TR 2023/1 ruling and, if needed, get a private ruling.
## Conclusion
Even if you’re never in Australia full-time, the **quality and continuity of your ties** may still make you a resident under Australian tax law. Digital nomads should be especially aware of how the rules under TR 2023/1 and related laws will affect where and how they report income, how much tax they pay, and their superannuation entitlements or obligations. When in doubt, err on documenting your circumstances and seeking qualified tax advice.