Tax residency certificate – (TRC) is a certificate issued by Federal Tax Authority (FTA), UAE to eligible companies and individuals to take advantage of agreements of double taxation avoidance on income earned in UAE. The validity of the certificate is for a period of one year and starting date of the period can be selected by the applicant as per its own requirement.

The main purposes of tax residency certificate are as follows:

• To prove that the residency of the applicant is UAE
• To avoid double taxation i.e. paying tax in two different countries
• Ease the process of cross-border trade and investment flows
• Economic diversification
• Boost the business sectors.

What is Double Taxation Avoidance Agreement and Countries?

A scenario in which a same tax payer is imposed tax by two different countries on the same tax base is called double taxation and to avoid this unfair situation, a treaty is signed by between countries and is called DTAA.

UAE has signed the Double Taxation Avoidance Agreement with 117 countries including countries like:

India | Pakistan | Saudi Arabia | Egypt | Philippine | China | Japan | Malaysia | Germany | Finland | Italy | France | Romania | Turkey | Mauritius | Latvia | Ethiopia | South Africa | Iraq and etc.

View Full List

TRC for Individuals

A natural person who is applying for the TRC in UAE should have remained in the UAE for at least 180 days. Hence, the Non-residents are not eligible to apply for TRC.

Documents required for Tax residency certificate – Individual:

• Copy of the passport and valid permit of the applicant
• A copy of the Emirates ID.
• A certified copy tenancy agreement/Ejari or Utility Bill.
• Certified 6-month bank statement
• Prove of the source of income e.g. Salary Certificate etc.
• A report from the General Directorate of Residency and Foreigners Affairs specifying the number of days the resident has stayed in the UAE.
• Specific Format, if any, required for TRC from the country where the certificate needs to be submitted
• Letter to FTA.

TRC for Companies:

If a company is applying for TRC in UAE then it should have been operating in UAE for at least a period of more than one year.

Documents required for Tax residency certificate – Corporate:

• Copy of the Trade License and other legal documents
•  Copy of Audited Financial Statements
•  Copy of the company’s owners/partners/directors’ passports, Emirate IDs and valid residency permit
•  Certified 6-month bank statement
•  Copy of the Tenancy lease agreement/Utility bills.
•  Structure of the company (if it is not a sole proprietorship)

How WISE can assist you?

If you are looking to save your Taxes, WISE qualified experts will guide you step by step from the stage of submitting the application to approval by authority and finally receiving the Tax Residency Certificate.

Get in touch with our tax experts for free consultation at: tax@wisefinance.info