Tax Residency Certificate

A Free Trade Zone entity in UAE enjoys many tax and business possibilities. For starters, a FTZ company enjoys full exemption from corporate and income tax, 100 percent foreign ownership, free profit repatriation, no exchange restrictions, all benefits accruing from UAE’S nearly 80 double tax treaties.

There are several other benefits available to a FTZ like issuing residence permits and obtain tax residence certificates from the UAE government authorities for its foreign executives and expatriates. Furthermore, if a local bank account is maintained with some fund movements, the foreign owners and executives can apply to the Ministry of Finance to receive UAE tax residence certificates. A UAE residence permit and a tax residence certificate can be useful to many foreign owners and executives of FTZs who wish to register in the UAE. It is worth noting that banking institutions in UAE and many outside consider UAE tax residence certificates as sufficient proof of tax residency in the UAE, as in all cases, the advice of a competent tax lawyer must be sought.

What is the Double Taxation Avoidance Treaty?

The United Arab Emirates has signed Double Taxation Avoidance Treaties (DTAT) with a number of countries so that individuals and businesses:

Aren’t paying income tax to two governments for income earned in one country
Aren’t paying income tax on investments to more than one government
Can reduce or eliminate taxes paid on dividends and tax-exempt deposits
Can be exempt from capital gains taxes

For Individuals:

Copy of the passport.
Copy of valid Residential ID.
A certified copy of (residential) lease agreement.
Source of income/Salary certificate.
A validated 6-month bank statement

A report from the General Directorate of Residency and Foreigners Affairs specifying the number of days the resident has stayed in the UAE.
Tax forms (if any) from the country in which the certificate is to be submitted.

For Government:

1. A request letter signed by the authorised signatory

2. A copy of the decree and act of incorporation

For Companies:

A copy of the trade license and partners’ attachment.
Establishment contract certified by official authorities (if it is not a Sole Company).
A copy of the company’s owners/partners/directors’ passports
A copy of the company’s owners/partners/directors’ IDs

A copy of the company’s owners/partners/directors’ permits of residence
A certified copy of the audited financial accounts
A validated 6-month bank statement
A certified copy of the lease agreement.
Tax forms (if any) from the country in which the certificate is to be submitted.

Eligibility for Tax Residence Certificate in Dubai

Eligible

Company operating in UAE Mainland
Free Zone Company
An Individual Business Owner

Not Eligible

Offshore companies

N R Doshi & Partners has gamut of experience in offering professional tax planning and structuring services. We can help you with the following:

Suggesting right investment structure that adds value to your business
Incorporating ideal tax structure for your business (setting up offshore companies, trusts and foundations, international business companies, hybrid entities, etc.) in any part of the UAE
Using right jurisdiction and double taxation agreements to optimize your taxes and reduce withholding taxes on income, inheritance, capital gains, etc.
Planning for Non-treaty based taxes and Tax Residency certificates
Processing all statutory filings
Meeting all regulatory tax requirements

If you want to setup your business in UAE, and need any help with tax residence certificate, feel free to contact us. We will be glad to assist you.

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