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Tax Residence Certificate: What is this and how to get it?

In today’s world people are traveling more and are becoming flexible on were they want to live and work. Countries with low or no taxes are getting extremely popular in the modern day, this is as a result of the advantage it holds over those places who have high consistent tax bracket.

UAE is a tax free country, so if you are a tax resident in the Emirates, you will be relieved from tax burden in your home country, if Double Taxation Avoidance Agreement have been signed between those two countries.

Same comes in business sphere, nowadays businesses no longer restricted to a single territory or country. It is spread all over the globe as far as most companies start operate on an international scale and develop internationally during Globalization century.

Over the past 25 years the UAE has 94 agreements in place with other nations to avoid double taxation on investments overseas.

See the list of the countries: www.mof.gov.ae/En/strategicPartnership/taxAgreement/Pages/DoubleTaxtion.aspx

Benefits of tax residency in UAE:

  • use double taxation avoidance agreement between UAE and your country in order to levy income taxes at home
  • claim back the taxes in case you have paid them in the same year when you became UAE tax resident
  • fairness across the board for taxpayers, companies or individuals, and protecting national economy

In order to prove that you are a tax resident in UAE, you have to obtain a “Tax Domicile Certificate”, also known as “Tax Residency Certificate” or simply TRC.

UAE government has set certain rules on getting the certificate. They are the following:

  1.  You have to live in UAE for the major part of a year (183 days) and prove it by a
  2. letter from Immigration authority
  3. You need to have a resident visa and Emirates ID
  4.  You should have a valid tenancy contract in any Emirate
  5. You must provide a proof of income, for example bank statement or salary letter

The documents and the application are provided to the Ministry of Finance, which will do the compliance procedure and issue Tax Residency Certificate for you within approximately 2 weeks.

Today the government cost of a Tax Residency Certificate for individuals is 2,106 AED + professional fees (approx. 550$) which is valid for 1 year, and for corporates the certificate will cost 10,106 AED + professional fees.

You can now get a Tax Residency Certificate through our easy service.

We have a great level of experience in offering professional structuring for international customers and tax planning, this is done with the following:

  • Processing all legal filings
  • Helping meet all tax requirements
  • Advising right investment structure that adds value to your business
  • Incorporating suitable tax structure for your business in the UAE like offshore, in mainland or Freezone.
  • Using the benefits of double taxation agreements to optimise your taxes and cut restraining taxes on income, capital gains, etc.

Article written by, waseem

Our dedicated managers will be happy to support you on this matter. Feel free to Contact Us if you have any further inquiries.