Tax Residency Certificate is issued for eligible government entities, companies and individuals to take advantage of agreements of double taxation avoidance on income signed by the UAE.
To ensure that businesses based in UAE are not paying double the tax, UAE has entered into a Double Tax Avoidance Agreement (DTAA) with almost 76 Countries in the world.
It enables investors, individuals, and companies to claim the benefits of Double Taxation by the Tax Residency Certificate issued in UAE.
As a result of the Double tax treaty, any foreign company already paying tax abroad for the profits earned from the business can mitigate any potential tax burden in the UAE.
How to apply for the Tax Residency Certificate in UAE?
Tax Residency Certificate is issued by the Ministry of Finance, Government of UAE as per the provision for the avoidance of double taxation agreements.
For a person to apply for the certificate, he must be a resident in the UAE for at least 180 days; Non -residents cannot apply.
Companies that have run their business for 1 year in UAE can apply for the Tax Residency Certificate.
To apply for the Tax Residency certificate one must have an email and signup in the system. The certificate will be emailed to the customer upon initiating the payment and submitted the required documents.
Business Consultants will come handy here as they will provide you the right assistance. They will liaise with the Ministry and concerned authorities for the issuance of the Tax Residency Certificate.
Required Documents to issue the Tax Residency Certificate for Individuals
- A valid copy of passport and visa
- Bank statement for the last 6 months
- Certified tenancy contract with Ejari/ Title deed
- Salary Certificate
- Immigration (entry/exit) report of residency
Required Documents to issue the Tax Residency Certificate for Companies
- Copy of valid trade license copy
- Copy of valid lease contract/tenancy contract
- Copy of passport and residence visa (Manager/Director/Owner)
- Copy of Emirates ID of the signatory (Manager/Director/Owner)
- Certified bank statement of AED account for the last 6 months
- Audited financial statements
Who Can Apply for a Tax Residency Certificate?
- Individual investor or business owner
- A company that operates in the UAE Mainland, Freezone
- Employed individual
Who Cannot Apply for a Tax Residency Certificate?
- Branch of a Foreign Company
- Offshore Company
- A non-employed individual (with spouse visa)
Validity for Corporate/Individual
The validity of a Tax Residence certificate is for 1 year.
The process of issuing the Tax Residency Certificate takes almost 2-3 weeks, 1 week to approve the application and up to 2 weeks for the delivery of the certificate.
General FAQs on Tax Residency Certificate
1. Can a UAE offshore Company acquire a UAE Tax Residence Certificate?
No, Offshore Companies are treated as non-resident corporate entities for tax purposes and are not eligible for UAE Tax Residence Certificate.
2. Who are eligible to apply for the Tax Residence Certificate in the UAE?
The following entities can apply for the Tax Residence Certificate in the UAE
- Resident Company after one year of incorporation
- Individual investors/ employees with UAE Residence Visa (with the record showing 180 days stay in UAE (need not be continuous)
3. Should the individual stay in UAE for 180 consecutive days to meet the MOF requirements?
The Ministry of Finance has fixed a prerequisite for an individual applicant to have spent at least 180days in the UAE ( need not be continuous) within the year preceding the applications for the certificate.
4. Is it mandatory to have a residential address in the UAE for applying for Tax Residence Certificate?
Yes, a valid residential address in the UAE and a valid tenancy contract in the applicant’s name are mandatory conditions to apply for the UAE Tax Residence Certificate.
5. Is an international bank account statement accepted as part of the application?
The Ministry of Finance will not accept foreign bank statements. The applicant must have a UAE personal bank account in the UAE with having the account held for a minimum of 6 months. The bank statements (6months) must be stamped by the UAE bank.
6. Can the Tax Residence Certificate be pre-dated?
An individual/company can acquire backdated Tax Residency Certificates. There has to be required document proof of the applicant having a UAE residency visa, six-months bank statements, and a residential address for that period.
For any assistance on obtaining Tax Residency Certificate, feel free to reach out to us!
Contact: Aurion Business Consultants