( TRC )Tax Residency Certificate Obtaining in UAE 2024
Individuals who spend 183 or more days in the UAE during a year are considered tax residents. They can obtain Tax Residency Certificates (TRCs) and benefit from Double Tax Avoidance Agreements (DTAA) signed by the UAE with a number of countries.
The Ministry of Finance recently issued a decision, clarifying rules on determination of tax residency.
What is Tax Residency Certificate (TRC)?
Tax Residency Certificate TRC UAE is also called as Tax Domicile Certificate to take advantage of double taxation avoidance agreements signed by UAE. A certificate issued for eligible natural and legal persons to benefit from Double Tax Avoidance Agreements (DTAA) on income signed by the UAE.
Who can obtain TRC?
Both individuals and corporate entities recognized as residents of India have the option to acquire a Tax Residency Certificate. To obtain this certificate, an assesses officially considered a resident of India should submit an application in Form No. 10FA to the assessing officer. Upon satisfaction, the officer will then issue a residence certificate for the assesses in Form No. 10FB. It’s worth noting that the application for a Tax Residency Certificate cannot be completed online.
Documents Required to Obtain Tax Residency Certificate
A few important documents have to be submitted to obtain a Tax Residency Certificate, and the specific requirements may vary based on the parties involved. The following is the list of required documents for different parties:
TRC Requirements For Company
- A copy of the Certificate of incorporation.
- Corporate organizational structure.
- Copies of the directors, shareholders, or managers Passports, along with valid UAE residency visas.
- In addition to having a current UAE trade license (Mainland DED or Free Zone), the business must have been in operation for at least a year.
- A copy of the company’s Memorandum of Agreement (Memorandum of Association).
- The UAE company’s most recent certified audited financial statements or bank statements for the previous six months, duly stamped by the bank.
TRC Requirements For Individuals
- Copy of your Passport, your UAE Residence Visa, and Emirates ID.
- A copy of the (residential) lease agreement or Tenancy Contract Copy
- Latest Salary certificate
- The recent and verified Bank statement from the previous six months.
- A report from the General Directorate of Residency and Foreigners Affairs tracking all the entries and exits and the number of days the resident has stayed in the UAE
TRC Requirements For Investors
- Company License
- Name of the Partner
- Any other documents mentioned earlier
Benefits of Acquiring the Tax Residency Certificate
The UAE’s attractive tax environment is only one of the many factors that attract business there. Now that we know why the UAE requires a Tax Residence Certificate, let’s look at why acquiring one is so important:
- Income taxes for individuals and businesses are excluded.
- It greatly encourages trade between countries.
- It confirms an individual’s or organization’s standing in the UAE legal system.
- As you go through the import-export process, having the certificate helps you avoid paying additional taxes.
- It improves bilateral trade relations.
- Avoiding double taxes and profiting from tax exemptions are two benefits of being a UAE resident with the certificate.
- Individuals and companies can receive multiple certifications.
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