Jurisdiction of Integrated Estate and Gift Duty
24.61. The base of an estate and gift duty should include the real and personal property, wherever situated, of a deceased person or donor domiciled in Australia, and such of the real and personal property of a deceased person or donor domiciled outside Australia as is situated in Australia. Domicile, in broad terms, depends on where a person intends to reside permanently. In the case of a married woman, however, it depends on the domicile of her husband and this may be thought to make it less appropriate than residence as the basis of jurisdiction. However, domicile has a number of distinct advantages over residence. In other countries domicile is generally preferred and it will therefore assist in preventing double taxation problems if Australia retains domicile. Domicile is more difficult to change than residence and the retention of domicile will protect the Revenue against a change in place of living made to avoid Australian tax. The position of the married woman could perhaps be accommodated by allowing an exemption in respect of property outside Australia if a married woman has for a period of years before gift or death been ordinarily resident outside Australia.
24.62. In the past, reliance has been placed on the commom law rules to determine the situs of property. These rules largely depend on considerations of convenience and are not always appropriate in a taxation concept and sometimes permit avoidance. The Committee recommends that detailed rules be adopted. These rules are discussed in Appendix C to this chapter.
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24.63. Where property is situated outside Australia and the law of that place has a gift or death tax, the amount of any such tax which is imposed in relation to that property on a donor or deceased estate should be allowed as a credit against any Australian gift or estate tax which is imposed in relation to that property on that same person, the credit being limited to the amount of the Australian tax.