UAE Tax Residency Certificate With New Regulations
The UAE holds a manifold economy that fascinates investors and businesses around the globe. One of the reasons is the auspicious tax culture. In order to benefit from double taxation, the UAE Cabinet ministers proposed a decision on the 9th of September 2022 regarding the standards for individuals or enterprises to be a Tax resident of the UAE for the exercise of any tax law or Double tax treaty.
Prior to the detailing of new guidelines, there were no statutory explanations. The new rules will be implemented from March 1st, 2023.
A common Person Observed a Tax Resident on the Following Conditions
• If they reside in the UAE and the country is their center of personal and financial interests.
• The physical presence of a person for about 183 days or more during the period of 12 consecutive months.
• If the physical presence of a person has been noticed in the United Arab Emirates for 90 days or more during the 12 consecutive months and the person is a citizen of the UAE, has a credible residence permit in the UAE, or is a citizen of any member state of the cooperation council of the Gulf. Alongside,
• They have a place for accommodation at any moment in the United Arab Emirates.
• They have a job from regional companies or own a business in the country.
• The people who hold tourist visas, Sportsperson, or people who are undertaking medical treatments in the UAE do not fall under residence permits.
• The activity performed by individuals or businesses entails material and non-material resources that constitute the term ‘business’.
Regardless of whether the company is recorded in a Free Economic Zone or not, the owner of the company and the employees have residence visas in the UAE.
If she or he has a sufficient income, can apply for residence permits for their family members. You can connect with the business setup in UAE for more inquiries.
New Tax Resident for Individuals
•The new tax residency does not signify that individuals will be made liable to personal income tax.
•The individuals who meet the above guidelines are considered UAE Tax Residents and taxation won’t be based on their personal income.
•It is possible to swipe away the obscure individuals’ carries regarding their UAE tax residency position under bilateral tax agreements the UAE has entered into with other territories.
New Tax Resident for Juridical Persons
Juridical persons recognized to be the United Arab Emirates Tax resident will be responsible for corporate Tax in the UAE which comes from the Corporate Tax Law.
The UAE Tax Residency Certificate
If a person meets above mentioned criteria he or she can file a request to the Federal Tax Administration for a Tax Resident certificate.
It is necessary that the application has to be filled with all required documents to avail of the UAE Tax residence certificate.
The International Agreements
If the UAE has signed an international agreement that controls providing a Tax resident certificate, the people that fall under such a category have to submit documents the ministry has asked for.
How to Apply for a Tax Residency Certificate in UAE
You can apply for a Tax Residency certificate by submitting an application with the following documents to Federal Tax Authority :
•A copy of your passport or national card.
•Proof of address in UAE.
• Documentation confirming your income and assets in UAE.
• Copy of your CV or Resume.
• A letter of introduction from your employer or sponsor, if applicable.
The Documents You Will Need to Provide as Part of Your Application
• Your resume or CV.
• A copy of your academic transcripts
• Proof of English proficiency, if required
• Letter of intent or statement of purpose
• Letters of recommendation
The Process of Applying for a Tax Residency Certificate
The process of acquiring a Tax Resident Certificate is not complicated. The person has to submit documents including a passport and proof of residence in the UAE. The authorities assess the application and might ask questions or further submission of documents.
If your application is approved, you will receive the Tax resident certificate. The validity of this certificate is of one year after which the person has to renew it to access its perks. The updated documents are necessary for the renewal of the certificate. The steps are the same as that of applying for a certificate before.
If you are an individual or business who wants to be in the UAE and falls under above mentioned categories, it is better to gain more knowledge relating to these substantial changes in the new Tax residency certificate for smooth functioning, since the UAE government has declared it as a mandatory document.
