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Post By: admin January 15 2021

How to get tax residency certificate in UAE?

UAE has signed the Double Taxation Avoidance Agreement with many countries across the world. In this context, tax residence certificates are used widely to get the benefit from these agreements with other countries. Here we discuss mainly the inference of tax residency certificate for individuals in UAE.

What is a tax residency certificate?

It is a certificate issued by the government body of any country to state that the individual or corporation holding the certificate is resident of that country. This certificate is mainly used globally for the purpose of evidencing the residency status of any individual/corporate during tax calculations as applicable to the country/countries in which the certificate holder is a resident.

Who all can apply for a tax residency certificate in UAE?

In the case of individuals, only residents in the UAE can apply for a tax residency certificate. Also, it is to be noted that the applicant must have stayed for a minimum period of 180 days in UAE to become eligible to obtain the tax residency certificate.

How long is the validity period for a tax residency certificate obtained in UAE?

Tax residency certificate is valid for one year from the date of its issuance. 

What are the advantages of obtaining a tax residency certificate?

There are treaties agreed upon between several countries to avoid the situations of double taxation. The tax residency certificate is considered to be one of the major supporting documents to prove residency for any person for tax accounting purposes. Individuals can use this certificate to avoid the income tax, where ever legally possible and prevent the situations of double taxation. Especially financial institutions such as banks consider this certificate to decide on the tax deductions requirements of individuals based on their residency.

What are the procedures involved in obtaining a tax residency certificate in UAE?

The tax residency certificate is issued by the Ministry of Finance (MOF) in UAE. Applicants have to create an online account in the MOF portal, where the application for tax residency certificate can be filled in and submitted along with all the supporting documents as required. The application will be reviewed and approved by MOF, if eligible. Once approved, the required fees can be paid electronically and the Certificate can be generated. Original Certificate can be either collected from the MOF office or it can be couriered to the address as opted by the applicant. 

What are the documents required for a natural person to apply for tax residency certificate in UAE?

For an individual to apply for the tax residency certificate, following documents are to be submitted:

  • Copies of identification documents such as Emirates ID and passport
  • Residence permit
  • Bank statements for last six months
  • Salary/income certificate
  • Copy of tenancy contract
  • Statement from the General Directorate of Residency and Foreigners Affairs to evidence the duration of applicant’s stay in UAE
  • Any other document as specifically asked by the authority

Applicants shall ensure the accuracy and completeness of the documents in advance to avoid delay in the issuance of certificate or rejection of application by MOF. Also, individuals shall be aware of the recent developments relating to tax regulations as applicable for better tax planning.

CDA in Tax Residency Certification in UAE

Are you struggling to comply with the registration requirements or application processes for obtaining tax certificates or refunds? Are you getting confused with the various tax implications on your business transactions? You can reach out to CDA Accounting and Bookkeeping Services LLC to get a better understanding of the tax impacts and to get our assistance in your tax, accounting, compliance and reporting activities. 

Also read, How Certificate of Entitlement Help Expo 2020 Participants in Reclaiming Tax?

CDA can guide you on various requirements, whether they be at the implementation or documentation level. We have dedicated tax consultants who can provide you with value-adding feedback on your tax processes and introduce to the best tax practices in the region. 

This brings us to the conclusion of the discussion on how to get a tax residency certificate in UAE. Need help in obtaining a tax residency certificate in UAE? Feel free to contact CDA for quick support.