Are you interested in gaining tax residency in Dubai, UE? This is your one-stop guide to learning how to get tax residency! The UAE is a top destination of the Gulf, decorated with booming skyscrapers and a convenient international airport. But the thing that makes it most appealing is its zero taxation.
Another attractive feature is the facilities offered by free trade zones. All of this has brought in an unpredicted number of new residents over the past decade. So let’s dive deeper into tax residency in Dubai, UAE to give you all of the information needed to apply.
What Exactly is a Tax Residency Certificate in Dubai, UAE?
A tax residency certificate is officially known as a tax domicile certificate. It’s a document that confirms a specific country as the official tax residence of an individual or company. The Ministry of Finance issues these certificates and they come with a validity of one year.
The main benefit of doing business in the UAE is that if you register a free zone company, then you are able to obtain this certificate. It allows you to take full advantage of the benefits that come with the UAE’s treaties involving the avoidance of double taxation.
Free Trade Zones
There are strict rules in the UAE in regards to foreign investment, most of which aren’t commonly known. Non-national investors are not allowed to own more than 49% of the shares of a business. As a result, they cannot own a business in the UAE. However, that limitation is lifted in free trade zones.
Some of the major benefits of owning a business in a free trade zone include the following:
Individual Taxes
There are no personal income taxes in Dubai, which is another reason it’s so appealing to foreign investors. As a result, there was no concept of tax residency until recently. The Ministry of Finance started issuing tax residency certificates in order to give residents a way to prove their residency. If you can prove that you’ve lived in Dubai for at least 183 days, then you probably qualify for tax residency.
Dubai does tax residential rental property at a rate of 5% the value of the property. There is also an indirect VAT tax of 5% on specific consumable goods bought in Dubai.
How to Get Tax Residency in Dubai
If you use our real estate services in Dubai, then our lawyers will check your eligibility to be a tax resident in the UAE. The main qualification is that you have to be a resident of the UAE for at least half a year. So let’s take a look at getting that step out of the way.
Gain Residency in Dubai
Gaining residency in Dubai is not that difficult. There are three different method that you can follow depending on your circumstances.
- Workers: Residency for workers is gained by having sponsorship from an employer in Dubai. This can be renewed every three years.
- Real Estate Investors: A real estate investor with $275,000 invested in Dubai property can apply for residency.
- Business Owners: Incorporating a business within one of Dubai’s free trade zones allows for residency.
Once you have become a Dubai resident, you can register for a tax residency certificate. Here are the necessary steps.
Applying for a Tax Certificate in Dubai
- Visit the Ministry of Finance Website and create an account.
- Find the application and add all necessary information. You will also need to attach relevant documents to the application.
- Upon approval of the application, a fee is required.
- Receive your tax residency certificate. In most cases, the certificate is delivered through a local courier.
If you travel and spend a lot of your time in other countries, then you need to apply for a tax residency certificate for the period during which you receive the majority of your income.
With that said, let’s look at some of the major documentation required when applying for tax residency in Dubai, UAE.
Required Documents for Tax Residency in Dubai, UAE for Business Owners
- Memorandum of Association
- Trade License
- Passports and Identification that Proves Ownership of property
- Financial records that have been audited
Lease Agreement with the UAE
Required Documents for Tax Residency in Dubai, UAE for Individuals
- Passports and UAE Identification
- Resident Visa
- Bank Statement Showing 6 Months of Finances. This must be from a local bank.
- Proof of at least 180 days residency in the UAE. This can be a General Directorate of Residency or Foreigners Affairs report.
- UAE lease agreement that has been registered in Ejari or with respective authorities.
- Proof of income.
- Tax forms from countries where you will submit the tax residency certificate.
Again, if you use our real estate services in Dubai, then we will help you with the registration process.
Take the First Steps Today
Our real estate services cover all of the legwork of applying for tax residency in Dubai, UAE. Since this is such an appealing place to own real estate, we find that offering such services to be a huge benefit to foreigners looking to invest in the UAE area.
If you want to avoid income taxes in the Dubai area, then getting your hands on a tax residency certificate is a great choice! Let our lawyers make this easier by using our real estate services. Contact us today!