Tax Domicile Certificate
In the UAE, the Ministry of Finance publishes the Tax Residency Certificate (TRC) as an authentic record. The UAE has set up tax treaties with 55 countries to remove double taxation. This certificate confirms that the UAE acknowledges an man or woman or entity as a tax resident. It enables foreign traders and agencies from different jurisdictions to keep away from double taxation. The UAE issues TRCs to organizations registered domestically and individuals holding a UAE residency visa.
Individuals who’ve resided within the UAE for over 180 days are eligible to apply for a TRC. UAE-primarily based groups can completely leverage double taxation benefits, thanks to the UAE’s massive network of bilateral tax treaties designed to guard the pastimes of overseas traders and corporations. However, offshore companies are excluded from these tax treaties and can’t obtain a TRC. Instead, they can apply for tax exemption certificates, which give restrained tax advantages.
To follow for a TRC within the UAE, you should observe unique procedures. After submitting all required documents, the Ministry usually issues the certificate inside two months. Companies must be operational inside the UAE for at least three years to qualify for a TRC.
Documents for Companies
- All company documents
- Request letter from the company
- Shareholder passport copy, visa page, ID copy
- Audited financial statements
- 6 months bank statements
- Tenancy contract copy and EJARI
- Government fees will be around AED 5,000.00.
Documents for individuals
- Passport copy and visa page, Emirates ID,
- Tenancy contract and EJARI
- Source of income/Salary certificate
- 6 months bank statements
- Immigration report stating the number of days the person has stayed in the UAE
- Government fees will be approximately AED 2,000.00
Tax Residency Certificate Importance
A Tax Residency Certificate (TRC) is a crucial document issued by the UAE Federal Tax Authority (FTA) that establishes an individual’s or a company’s residency status for tax purposes. It is especially valuable for businesses and individuals seeking to take advantage of the UAE’s extensive network of double taxation treaties.
Here’s why a TRC is important:
- The UAE’s 100+ treaties prevent double taxation, letting businesses and individuals avoid paying tax twice.
- A TRC enables tax exemptions or reduced rates on foreign income, cutting overall tax liabilities.
- TRC provides official proof of UAE tax residency, ensuring compliance with foreign tax authorities.
- TRC showcases compliance with tax laws, strengthening trust with global clients and investors.
- TRC simplifies cross-border transactions, ensuring smoother tax processes and treaty benefits internationally.