All about Tax Residence Certificate in the UAE

Certificates of tax residency are issued by the UAE’s Federal Tax Authority to both individuals and businesses. Tax Residency Domicile is another name for UAE tax residency certificate. 

One of the official documents issued by the Ministry of Finance in the United Arab Emirates is a Tax Residency Certificate. To prevent double taxation, the UAE has tax treaties with 55 nations. A tax residency certificate proving that a person or business is based in a particular nation. Companies from other taxable jurisdictions and foreign investors will be able to prevent double taxation. It is given to individuals with residency visas or to businesses that have already registered in the UAE. 

What does a Tax Residency Certificate mean? 

A company operating in the UAE can obtain a Tax Residence Certificate (TRC) from the UAE Federal Tax Authority (FTA), which establishes its tax residency and entitles it to benefits under double taxation avoidance agreements. The certificate, which is also known as a tax domicile certificate in the UAE, is for people who reside in the UAE as well as for organizations and legal entities. 

The Tax Residency Certificate is available to any enterprise operating in the UAE for at least a year, whether it be in a Freezone or on the mainland.  

Additionally, the Tax Residency Certificate is only available to people who have lived in the UAE for at least 180 days. To apply, the person must have a valid UAE resident visa valid for more than 180 days. 

Why Do We Need a Tax Residence Certificate in the UAE?  

With a UAE tax residency certificate, you can benefit from Double Tax Avoidance Agreements (DTAAs) in other nations that have DTAA treaties with the UAE. 

• A document attesting to your status as a UAE tax resident. 
• a method of registering with the tax authorities, which would require the exchange of up-to-date information on both ends. 

How do I obtain a UAE Tax Residence Certificate? 

To qualify for the TRC as an individual, you must have lived in the United Arab Emirates for more than six months. There are numerous routes you can take to settle in the UAE, and Shuraa Tax can guide you through them all. Our corporate governance services may be of interest to you if your company has been around for more than a year and is successfully run out of the United Arab Emirates. In this case, you are also eligible for the Tax Residency Certificate. 

Steps needed to obtain a Tax Residency Certificate 

• Register for an account on the website of the Ministry of Finance (MoF). 
• Fill out the application and attach the required documents in PDF or JPEG format. 
• Make an online payment as soon as your application is accepted. 
• Certificate will be issued online. 

That’s it, then! 

You might not have a clear tax situation if you spend a significant amount of time abroad. Therefore, we always advise obtaining a Tax Residency Certificate in the UAE, if not permanently, then at least for the time frame in which you receive the majority of your income. 

Requirements for a company to get Tax Residency Certificate 

• Trade License for the UAE that has been active for over a year (Mainland or Freezone) 
• Copy of the company’s Memorandum of Association. 
• Copy of the business’s Certificate of Incumbency (normally the Chamber of Commerce certificate, if requested).
• The organizational chart for the business (if requested). 
• Copy of a valid passport copy of shareholders and managers. 
• Copy of each director’s, shareholder’s, or manager’s Emirates identification card. 
• Recent certified audited financial statements  
• Bank statements from a UAE company for the previous six months, stamped by a UAE bank. 

• The UAE Federal Tax Authority will accept credit/debit Cards as payment  

Requirements for an individual to get Tax Domicile Certificate 

• At least 180 days before the application, a copy of the applicant’s passport and current visa are both issued. 
• Copy of Emirates ID. 
• 6 months’ worth of personal UAE bank statements with bank stamps. 

• An employment contract, a share certificate, or a salary certificate are examples of acceptable UAE proof of income. 
• Evidence of all entries and exits from the United Arab Emirates is provided in a report from the General Directorate of Residency and Foreign Affairs. 
• A certified lease that has been in force, in copy or as a title deed. 
• The UAE Federal Tax Authority will accept Debit/ credit Cards for payment  

Timeframe for UAE Tax Residency Certificate 

• Pre-approval procedure: After filling out the application form and uploading all necessary documents, it will take the UAE Federal Tax Authority 4 to 5 working days to approve the application and confirm that all uploaded documents are accurate. 
• Process for issuing certificates: 5 working days following approval and confirmation from the UAE Federal Tax Authority and payment of the application fees. 
• Certificate validity: The Tax Residency Certificate / Tax Domicile Certificate is valid for one year, after which it may be renewed yearly with a new application. 

Conclusion 

To maximize the benefits of the tax residency certificate in Dubai, effective tax planning utilizing a multidisciplinary approach supported by solid business acumen, accounting and finance structures, and current tax regulations is required. 

Shuraa Tax Consultancy will help you put together the necessary paperwork for the UAE Tax Residency Certificate. Our tax accountants will offer business and individual clients’ advice on how to properly apply for a Tax Residence Certificate (TRC). Simply email us at info@shuraatax.com or give us a call at +971 508912062 and +971 508912403.