What is domicile?
About domicile …
Domicile is an old “common law” concept. Domicile is NOT the same as “residency” (although it might include residency). Domicile is NOT the same as “citizenship” (although one could be a citizen of the country where one is domiciled). Domicile is a concept that refers to one’s permanent home and point of reference. Different jurisdictions might have differing definitions of domicile. It is also a concept that is relevant for a variety of purposes.
Why might domicile matter?
#Domicile is a question of fact and a matter of proof!! Interesting UK Gov discussion on the kinds of domicile. https://t.co/lXUUSAPoOy pic.twitter.com/5Ep6tLymSW
— Tax Residency (@TaxResidency) November 1, 2017
Domicile 101 – Different kinds of domicile …
Q. What is domicile? A. There are 3 kinds: "domicile of birth", "domicile of dependence" and "domicile of choice". https://t.co/VgFLOEkORX
— Tax Residency (@TaxResidency) November 1, 2017
Learning about domicile …
Much has been written about domicile. Here is a fantastic article written on domicile that was presented in 2011 at an ABA convention. It doesn’t get better than this:
domicile ABA Meeting 2011
Let me offer 5 key points from this article:
About #Domicile:
1. What is domicile? pic.twitter.com/07f3Q1sYJU
— Tax Residency (@TaxResidency) May 27, 2018
About #domicile
2. Tax consequences of #domicile pic.twitter.com/XpmrUU3D4h
— Tax Residency (@TaxResidency) May 27, 2018
About #domicile:
3. Evidentiary standard to determine whether one has acquired domicile pic.twitter.com/a5kvfx93MA
— Tax Residency (@TaxResidency) May 27, 2018
About #domicile
4. It is not easy to change domicile. More than an intention to change domicile is required. pic.twitter.com/ARPd3SHIKi
— Tax Residency (@TaxResidency) May 27, 2018
About #domicile:
5. In determining whether a person is domiciled in a place the court looks to a number of factors which include: pic.twitter.com/oFHtkC7Gqc
— Tax Residency (@TaxResidency) May 27, 2018
Can a person have domicile in more than one place for tax purposes?
Of course you can be domiciled in more than one place for tax purposes! In fact:
In the USA there's no constitutional reason that one cannot be subject to worldwide taxation in more than one state! https://t.co/Dk3eFLiuYU pic.twitter.com/kOhrhocgOx
— Tax Residency (@TaxResidency) November 1, 2017
Domicile as the definition of “tax residency” for U.S. Estate and Gift tax purposes
How do we know that “residence” for Estate and Gift Tax purposes means “domicile”?
The answer is found in the Treasury Regulations – Specifically Reg. 25.2501-1(b) which defines “residency” for Estate and Gift Tax purposes as follows:
(b)Resident. A resident is an individual who has his domicile in the United States at the time of the gift. For this purpose the United States includes the States and the District of Columbia. The term also includes the Territories of Alaska and Hawaii prior to admission as a State. See section 7701(a)(9). All other individuals are nonresidents. A person acquires a domicile in a place by living there, for even a brief period of time, with no definite present intention of moving therefrom. Residence without the requisite intention to remain indefinitely will not constitute domicile, nor will intention to change domicile effect such a change unless accompanied by actual removal.
Please note that different jurisdictions may define “domicile” differently.
Conclusion …
“Domicile” is largely a “subjective” concept that is proven by “objective” evidence.
Domicile matters!
John Richardson