The UAE Tax Residency Certificate

In October 2024, the Federal Tax Authority of the United Arab Emirates published a Guide on determining tax residency of legal entities and individuals and issuing a tax residency certificate in the UAE (the Guide). 

Compared to previously applicable rules, the procedure for applying for a Tax Residency Certificate for juridical persons has been simplified. The following requirements have been removed:

• to provide financial statements with an auditor’s report from an approved audit firm and
• to provide a local bank statement covering 6 months of the financial year for which the certificate is requested.

What is tax residency, and when does it need to be confirmed?

Tax residency is a person’s relationship to a particular jurisdiction for tax purposes. It directly affects the person’s tax obligations, including when taxes arise in two or more countries.

A tax residency certificate (TRC) is an official document issued by a tax authority confirming that a person is a resident of a given country for tax purposes. The documentary proof of tax residency of a recipient of income may be required:

• when applying for benefits under double taxation agreements or
• in other cases, for example, for submission to banks and other financial institutions or when confirming the change of tax residency to foreign tax authorities.

Below are the rules for determining tax residency under the UAE’s domestic legislation. If residency needs to be determined to apply a double taxation agreement (DTA) between the UAE and a specific state, the provisions of such an agreement will prevail.

Tax residency of juridical persons in the UAE

A juridical person is a resident person for corporate tax purposes in the UAE if it is:

• incorporated under the legislation of the UAE (including free zones) or
• incorporated outside the UAE, but its effective management and control is exercised in the UAE.

Registration (incorporation) in the UAE is the primary indicator of a company’s tax residency. A juridical person can be incorporated in one of the forms provided for by federal legislation on companies or the rules of any free zone within the UAE. Thus, both UAE mainland companies and free zone companies have the right to apply for a tax residency certificate.

When a company is incorporated outside the UAE, it may be considered a tax resident if the UAE is the place of its effective management and control. The place of effective management and control is the place where “key management and commercial decisions” that are necessary for the conduct of the juridical person’s business as a whole are made.

Determining the place of effective management and control involves identifying the persons who make key management and commercial decisions and determining the place where such decisions are primarily made. The Guide provides tests for identifying a company’s decision-makers and decision-making locations.

Tax residency of natural persons in the UAE 

The Cabinet Decision No. 85 of 2022 on Determination of Tax Residency provides for three independent grounds on which an individual can be recognized as a tax resident: 

1. A person has been physically present in the UAE for 183 days or more, within the relevant 12 consecutive months.
2. A person has been physically present in the UAE for a period of 90 days or more within the relevant 12 consecutive months and:
   • is a UAE or Gulf Cooperation Council (GCC) national, or holds a valid UAE residence visa, and
   • has a permanent place of residence in the UAE or carries on employment or business in the UAE. 
3. The UAE is a person’s usual or primary place of residence and centre of financial and personal interests.  

Accordingly, to be considered a tax resident and be able to confirm it officially, a person does not need to stay in the country for 183 days or more. However, if the period of stay in the UAE is shorter than 183 days, the person must meet the additional conditions showing his or her connection to the jurisdiction, as specified above.

A natural person will only be treated as a resident for corporate tax purposes if he or she conducts business in the UAE and the annual turnover from such business exceeds 1 million AED (approx. 272,000 USD).

Obtaining a tax residency certificate in the UAE

The UAE Federal Tax Authority issues tax residency certificates:

• for application of double taxation agreements or 
• for other purposes. 

FTA may also, at the request of the applicant, issue a certificate prepared in accordance with the requirements of a foreign jurisdiction (if such requirements differ from the standard form used by FTA).

The certificate proves a person’s tax residency in a specific tax period or other 12-month period for which the person needs such a confirmation. A juridical person’s tax period is its financial year. For natural persons, the tax period is a calendar year. 

The certificate may cover the current or prior (but not the future) tax period. A juridical person may apply for the certificate regarding the current tax period not earlier than three months after the start of this period. A natural person may obtain the certificate for the current period after achieving the required duration of stay in the country.   

Newly incorporated companies that have yet to file a corporate tax return may apply for a tax residency certificate no earlier than 12 months after incorporation. 

Documents required from juridical persons

A juridical person who is obtaining a UAE tax residency certificate must submit the following:

1. Licence;
2. Lease agreement;
3. UAE Tax Registration Number for corporate tax (if available);
4. Certificate of incorporation;
5. Certified copy of the Memorandum of Association;
6. Authorised signatory’s name, Emirates ID and passport and proof of their authorisation (Establishment Contract or the Power of Attorney);
7. proof of being effectively managed and controlled in the UAE (if applicable) in the form of a written statement and supporting documents.

Documents required from natural persons

For an individual, the list of documents required to apply for the certificate depends on the basis on which such an individual can be recognised as a UAE tax resident.  

Grounds	Documents required to obtain a tax residency certificate
A person has been physically present in the UAE for 183 days or more in a consecutive 12-month period	Emirates ID and residence visa, or  Copy of passport, and entry and exit report from the Federal Authority of Identity and Citizenship or a local competent Government entity.
A person has been physically present in the UAE between 90-182 days in a consecutive 12-month period	One of the following: Emirates ID and resident visa, or  Copy of passport, and entry and exit report from the Federal Authority of Identity and Citizenship or a local competent Government entity. One of the following: proof of employment or business (proof of source of income, salary certificate, or evidence of carrying on a business in the UAE), or proof of permanent place of residence, for example, certified tenancy contract, or written statement from the landlord (owner), or title deed with a utility bill in the name of the natural person.
A person has a primary place of residence and centre of financial and personal interests in the UAE	One of the following: Emirates ID and resident visa, or  Copy of passport, and entry and exit report from the Federal Authority of Identity and Citizenship or a local competent Government entity. Proof of financial and personal interests in the UAE (a written statement and supporting documents); Proof of primary place of residence, for example, certified tenancy contract, or written statement from the landlord (owner), or title deed with a utility bill in the name of the natural person; Proof of source of income, for example, salary certificate, share certificate, trade license, UAE bank account statements.

Certificate application procedure

Both juridical and natural persons may apply for a tax residency certificate via the FTA’s EmaraTax portal using their account. The applicant must fulfil the required particulars, upload supporting documents, and pay submission and processing fees. 

The FTA is expected to respond to the submitted application within 10 business days of receipt. It may approve or refuse the application or require additional documents. In each case, the tax authority assesses the applicant’s compliance with the tax residency criteria and decides whether to issue or refuse a certificate at its discretion.

The issued certificate will be available for download in electronic form and can also be delivered in paper form upon request.