Tax Residency Certificate (TRC)
In this current world, individuals and businesses may reside in multiple countries, yet their tax residency is recognized in only one nation. The UAE’s Tax Residency Certificate—also known as the Tax Domicile Certificate—serves as proof that you are considered a tax resident of the UAE. This means you pay taxes in the UAE and are exempt from taxation in other countries with which the UAE has established Double Taxation Avoidance Agreements (DTAA).
Both individuals and companies that fulfill certain criteria can get a Tax Residency Certificate in the UAE. With this certificate, any business income earned in the UAE or through overseas offices is taxed in the UAE, and the certificate can be submitted to the appropriate authorities in those other countries.
Facilitate Your UAE Tax Residency Certificate Application
Our team makes the process easy with personalized solutions designed for you.
Eligibility For Tax Residency Certificate
There are three categories of businesses in the United Arab Emirates – Offshore (International Business Companies, or IBC), Free Zone, and Mainland. The advantages of a Tax Domicile Certificate, or TRC, are available to both mainland and free zone businesses. Offshore businesses, however, are not eligible for these tax treaty benefits and are unable to acquire these certifications. However, offshore businesses can apply for a tax exemption certificate in order to benefit from tax residency.
Major Documents Required for Tax Residency Certificate in UAE
TRC Documents for Individuals -
- Salary Certificate (if employed)
- Company License (if owning a UAE company)
- 6-month verified bank statement
- Certified tenancy contract or lease agreement
- Passport copy
- UAE residence visa copy
- Emirates ID copy
TRC Documents for Companies -
- Certificate of Incorporation copy
- Passport copies of directors/shareholders/managers
- UAE residence visa copies of directors/shareholders/managers
- Emirates ID copies of shareholders
- Valid UAE trade license (Mainland or Free Zone, minimum 1 year operation)
- Memorandum of Agreement/Association copy
- Company lease agreement copy
- Certified audited financial statements (last 6 months)
- Stamped bank statements
Tax Residency Certificate (TRC) Terms and Conditions for Companies
- A legal entity (business) must have been based in the United Arab Emirates for a minimum of one year in order to apply for a tax residence certificate for treaty purposes (outside the UAE).
- Since offshore businesses and branches of foreign corporations are not regarded as being founded in the United Arab Emirates, they are not eligible for tax residence certificates.
- Future periods beyond the chosen start date of the fiscal year are not covered by the Tax Residency Certificate. This holds true for both domestic (inside the UAE) and treaty purposes (outside). The only organizations that can do this are government agencies.
- To get a certificate of commercial activity, a legal person must be registered for VAT.
Tax Residency Certificate (TRC) Terms and Conditions for Individuals
- When getting a tax residency certificate for treaty purposes (outside), a natural person (individual) must have visited the United Arab Emirates for a minimum of 183 days in the year in question.
- A natural person (individual) may still apply if they fit into any of the following categories and are looking for a tax residence certificate for domestic use (inside the United Arab Emirates). More than 183 days, fewer than 183 days but more than 90 days, or less than 90 days in the United Arab Emirates.
- A future is not covered by the Tax Residency Certificate. This holds true for both domestic (inside the UAE) and treaty purposes (outside).
Procedure For Obtaining a Tax Residency Certificate (TRC)
Eligibility Verification
Before initiating the application, confirm your business or individual status meets the UAE’s TRC requirements.
Federal Tax Authority (FTA) Registration
Ensure your business is registered with the FTA and compliant with all applicable taxes, including VAT and Excise Tax.
Compliance and Legal Structure
Verify that your company adheres to all FTA regulations, particularly ESR, demonstrating substantial economic activity within the UAE.
Online Application via UAEPass
Utilize the UAEPass digital identity for secure access to the FTA portal.
Document Submission
Prepare and upload all demanded documents as defined by the FTA.
Application Fee Payment
Pay the required TRC application fee through the FTA portal. This payment is vital for processing your application.
Application Status Monitoring
Track the progress of your TRC application through the FTA portal.
TRC Issuance
Upon approval, the TRC will be issued digitally and can be downloaded from the FTA portal.
Benefits of a UAE Tax Residency Certificate (TRC)
Double Taxation Relief
Sidestep pays taxes on the same income in two countries, thanks to UAE’s DTAAs.
Enhanced International Credibility
Prove your UAE tax residency to foreign authorities, boosting trust and legitimacy.
Reduced Withholding Taxes
Lower tax rates on dividends, interest, and royalties, maximizing income.
Legal Compliance & Protection
Ensure adherence to international tax laws and avoid legal problems related to tax residency.
Strategic Tax Planning
Optimize tax liabilities and structure your finances efficiently within UAE’s framework.
Improved Market Access
Gain a competitive edge in international markets through reduced tax burdens.
UAE Tax Advantages Reinforcement
Solidify your access to the UAE’s favorable tax environment, including potential income tax exemptions.
Facilitated International Trade
Reduce tax related obstacles during import and export, and strengthen international business relations.
Key Considerations for TRC Application and Ongoing Compliance
While the TRC application process is straightforward, strict adherence to FTA regulations is crucial. Neglecting the Taxpayer Charter or related statutes can result in penalties or application delays.
- Document Accuracy and Currency – Ensure all documents, including your Commercial Activity Certificate (CAC), VAT registration, and financial records, are current and accurate.
- Consistent Tax Filing – Maintain a record of timely tax filings, including VAT and Excise Tax returns. This indicates your obligation to tax obedience and is essential for maintaining a good reputation with the FTA.
- Staying Informed on FTA Updates – Routine review FTA guides, references, and public clarifications. These resources, accessible through the FTA's Media Centre or E-Learning modules, provide essential updates and clarifications on tax-related matters.
- Professional Tax Assistance – Consider engaging a qualified Tax Agent or consultant. While self-application is possible, professional guidance can minimize errors, ensure accurate documentation, and save valuable time.
Why Choose Arabian Wingz?
Handling the complications of tax regulations and ensuring proper company governance often requires expert guidance. A well-defined tax strategy provides an objective analysis of your business model and external influencing factors.
Arabian Wingz offers comprehensive services related to Tax Residency Certificates (TRC), also known as Tax Domicile Certificates, in Dubai and the wider UAE. Our experienced team streamlines the application process, handling document preparation and certification to ensure timely completion.
Beyond TRC assistance, we provide reliable and innovative solutions for all your accounting, bookkeeping, and auditing needs. For a detailed discussion on obtaining a Tax Residency Certificate in the UAE, or any other accounting related matter, please contact our expert accountants.
