The UAE's Tax Resident and Tax Residency Certificate guide

In October 2024, the FTA released a tax procedures guide on UAE Tax Resident and Tax Residency Rules providing general guidance, along with examples of tax residency as per UAE domestic law and under Double Taxation Agreements. The guide also includes details on the process of obtaining a Tax Residency Certificate in the UAE for Juridical and Natural persons.

The Guide provides the relevant criteria for obtaining a Tax Residency Certificate (‘TRC’). Significant changes in the guide are as follows:

The timing of the TRC applications

• The TRC can now be applied during the tax period (previously this was only possible after the completion of the tax period). The timing for the applications are now as follows:
  • For Juridical persons (i.e. companies registered in the UAE) - after 3 months from the start of the relevant tax period
  • For Natural persons - as soon as the criteria to be tax resident is met (under Domestic Law or under a Double Tax Agreement)
  • For government/government controlled entities, after one day in to the relevant year. 
• The TRC cannot be obtained for a future period i.e. the tax period which has not yet commenced as there is no certainty of a person qualifying as a resident for a future period. 
• Newly incorporated companies which are yet to file tax return must be established for 12 months before being eligible to apply for a TRC.

Documentation requirement for applying TRC

• TRC applications for Natural Person (under a Double Taxation Agreement). This assumes that individuals have been physically present in the UAE for more than 183 days in a 12 month period: 
  • Proof of residency in the UAE – this can include an Emirates ID and residence visa OR a copy of passport and entry and exit report,
  • Salary certificate or source of income
  • Bank statements are no longer a requirement for TRC applications.

• TRC applications for Natural Person (under UAE domestic law):
  To obtain a TRC under UAE domestic law, in addition to the documents mentioned for application of TRC for natural person under a Double Taxation Agreement, the following documents are required:
  • Total physical presence in the UAE between 90-182 days: proof of employment or business or proof of permanent place of residence
  • For the primary place of residence and centre of financial and personal interest in UAE: proof of financial or personal interest in UAE, proof of primary place of residence, and proof of source of income.

• TRC application for a Juridical person:
  • Corporate documentation (such as trade license, certificate of incorporation, Memorandum of association, UAE corporate tax registration number, proof of authorized signatory, proof of being managed and controlled in UAE as applicable)
  • The requirement for the submission of audited financial statements has been removed from the document requirements considering the application for TRC can now be submitted during the tax period.

The guide has recently been announced and the new requirements are not yet reflected on the FTA website but are expected to be rolled out shortly. Applicants and corporates who wish to discuss and understand the impact of the changes announced may consult with a member of their People and Regulatory Services team at KPMG.

Director
People and Regulatory Services 
KPMG Lower Gulf
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Manager
People and Regulatory Services
KPMG Lower Gulf
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Manager
People and Regulatory Services
KPMG Lower Gulf
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Manager
People and Regulatory Services
KPMG Lower Gulf
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