Tax Residency Certificate (TRC) in UAE

The UAE Tax Residency Certificate (TRC) is an official document, which is also referred to as a Domicile certificate. The TRC is issued by the Federal Tax Authority (FTA) electronically for individuals, and corporate entities/businesses operating from the UAE. The Tax Residency Certificate is meant to exempt certified individuals and/or businesses from double taxation, by leveraging the “double taxation avoidance agreement”, thus relieving them to pay taxes in home countries, since the individual/company is considered as a tax resident of the UAE. The TRC certificate is issued by FTA for the period of one year, whereas, it can be verified for authenticity online.

Importance of Tax Residency Certificate in UAE

Tax Residency Certificate is an official document issued by the government of the resident country to prove that an individual or corporate entity is residing in the country. Banking authorities, financial institutions and other departments are considering Tax Residency Certificate as the proof of tax residency in the country of residence. As Tax is one of the major sources of income for government across the globe tax rules. Aa a result, financial institution, especially banks require Tax Residency Certificate or Tax Domicile Certificate of their customers.

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Double taxation avoidance agreement (DTT)

The double taxation avoidance agreement (DTT) is a treaty between two countries, meant to relieve individuals and/or companies associated with import/export business of paying double taxes, as well as, to alleviate other taxes including VAT, income tax, inheritance tax, among others.

Thus far, UAE has signed a DTT agreement with over 100 countries, and thereby, can issue Tax Residency Certificate to individuals/companies operating from the country to relieve them from paying double tax. Saudi Arabia was the first GCC country with which UAE signed the DTT treaty, back in 2018.

Change of Authority

Until recently the TRC was issued by the Ministry of Finance (MoF). However, in November 2020, the TRC issuing authority was changed as per the Cabinet Decision No. 65 of 2020, and the Federal Tax Authority (FTA) was made the new regulatory authority to issue TRC. All individuals and companies residing in the UAE for a minimum period of 180 days or who have a valid UAE residence visa are eligible to apply for Tax Residency Certificate in the country.

Tax Residency Certificate for Individuals

Following documents are required to be submitted by individuals to apply for TRC:

  • Passport copy
  • UAE residency visa copy
  • Emirates ID copy
  • Latest salary certificate
  • Copy of the certified residential lease agreement or tenancy contract
  • 6 months validated bank statement
  • The validated report from the General Directorate of Residency and Foreign Affairs verifying the number of days the applicant has resided in the UAE
  • Tax forms (if any) from the country to where the certificate must be submitted

Tax Residency Certificate for Companies

Following documents are required to be submitted by companies to apply for TRC:

  • Company trade license copy
  • Establishment contract certified by official authorities (not required for companies with sole proprietorship)
  • Passport copy of shareholders and manager
  • Residence visa copy of shareholders and manager
  • Certified audit report/ financial statements
  • Copy of the company lease agreement or tenancy contract
  • Emirates ID copy shareholders and manager
  • 6 months validated bank statement
  • Tax forms (if any) from the country to where the certificate must be submitted
  • Copies of passports, IDs, and permits of residence of company’s owners/partners/directors’

athGADLANG offers comprehensive services for Tax Residency Certificate in the UAE. Our experienced professionals have the expertise, and resources to help you ease up the process of accessing documents and certifications required to complete the process of TRC. Get in touch with our experts today to discuss your TRC requirements.