Tax Residency Certificate

Guide to Obtaining a Tax Residency Certificate in the UAE

Within a remarkably brief span, the UAE has successfully transformed itself into a robust economy, drawing investments from across the globe. It has established its reputation as a cutting-edge global financial hub while simultaneously evolving into a favored tourist destination. Among the manifold advantages that entice businesses to the nation, the UAE’s favorable tax environment stands out prominently. A substantial majority of enterprises headquartered in the UAE enjoy tax-exempt status. Securing a tax residency certificate in the UAE through the Double Taxation Avoidance Agreements (DTAA) ensures that a taxpayer is not subjected to dual taxation in two distinct countries.

Understanding the Tax Residency Certificate

Issued by the Federal Tax Authority in accordance with the provisions outlined in the double taxation avoidance agreements, the tax residency certificate, also referred to as a tax domicile certificate, remains valid for one year. It is granted to both individuals and companies.

In order to leverage the benefits of the UAE’s double taxation avoidance agreements, companies and individuals must possess a Tax Residency Certificate (TRC).

Eligibility for Tax Residency Certificate (TRC) or Tax Domicile Certificate in the UAE

Individuals who reside in the UAE and own businesses within the mainland or free zones are eligible to apply for a Tax Residency Certificate or Tax Domicile Certificate. However, offshore businesses, due to their lack of physical presence in the UAE, may not meet the criteria for requesting a tax residency certificate.