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What is a Tax Domicile certificate?

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What is a Tax Domicile certificate?

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Known as a tax residency certificate, that is issued by the International Financial Relations & Organisations Department allows government entity companies and individuals to take advantage of agreements of double taxation avoidance.

The individual or company must either visit the ministry website or download the application to submit their documents. Once payment has been processed, a certificate will be issued within 3 working days.

For a person to obtain a tax residency certificate, they must have been a resident in the UAE for a minimum of 180 days.

For a company to obtain a tax residency certificate, they must have been operating in the UAE for a minimum of 1 year.

The good news for those who are looking to obtain a UAE tax residency (tax residency certificate of the UAE), is that there are no taxes on income. (The only exception is a government due on real estate income). The same rules are applied to companies that currently do not have corporate and other government taxes for companies located in the UAE. VAT was introduced at the beginning of 2018 at a rate of 5%. The UAE has also already signed many international agreements on the avoidance of double taxation.

Residency for tax purposes is a well-known concept for entrepreneurs in the UAE. Tax or fiscal residency is a set of regulations that vary from jurisdiction to jurisdiction and are mandatory to be strictly followed. They predetermine the taxes you have to pay, as well as the country they have to be paid to. Your tax residency governs the amount and type of taxes you would need to pay and the country where such taxes are due.

Tax Residency Certificate in United Arab Emirates is a document confirming that an enterprise or an individual has the status of a tax resident in the UAE. In case of Dubai, the Certificate of the tax resident is issued by the Ministry of Finance of the UAE.

To become a tax resident in the jurisdiction of the UAE, you will be required to file a set of standard documents, but most importantly - you will have to obtain the residence visa first. This can be done by purchasing real estate in the territory of UAE or registering a company in one of the Emirates.

You will also be required to file an immigration report for the purpose of confirming your trips to the UAE.

With our assistance the procedures are quite simple and straightforward. Our company will help you in preparing and filing all necessary documentation. Get in touch with our consultants and we will provide an all round assistance on the obtaining of the permanent visa and the tax residence certificate.

If you are running a company and are willing to become a tax resident in the UAE, the company must be a non-offshore one, while company’s CEO has to be a resident of the United Arab Emirates.

Please note that tax residence in the UAE does not mean that the authorities of other countries will accept it. If you have business in another country, the government of that country will still impose taxes on your enterprise. Inform yourself in regard to double taxation.

Tax residence certificate of the UAE can be received by either individuals or enterprises. After obtaining it, you will be able to enjoy a number of benefits such as tax privileges and possibility of getting visas for all family members. Tax privileges promote the success of your business and confidence in its future perspectives.

Please note that there is no personal income tax in the UAE (except for income tax on real estate which comprises 5% of rental income and is charged automatically). The same refers to companies located in the UAE – there is no corporate tax. However, the authorities have introduced a VAT with the rate of 5% - which has been in force since 2018.

As for the validity of the certificate, it is issued annually and is valid for one year from the date of its issuance.

The certificate of tax exemption can be obtained by an offshore company in the UAE. It differs from the certificate of a tax resident – it liberates you from a number of taxes, but does not confirm the tax residence of the company.

Tax residence certificate confirms your status of a tax resident of Dubai or any other Emirate - it can be obtained by both individuals and UAE companies. The document will allow you to enjoy the tax free environment of the free trade zones and a number of other benefits.

The certificate can be obtained retrospectively, meaning that the period of your previous stay can also be taken into account when issuing residence status confirmation under the condition that the respective documents are available.

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