New legislations have been published by the Cabinet of Ministers, which provide a new definition and criteria for when an individual or a business entity shall be considered a Tax Resident of the UAE. The same is applicable from 1 March 2023.
The domestic Tax Resident definition is aligned with internationally recognized standards and gives additional clarity to individuals and legal entities regarding their UAE tax residency position.
UAE tax residency criteria for legal entities
A legal entity is considered to be a Tax Resident of the UAE if:
· It is incorporated or otherwise formed or recognized in the UAE; or
· It is otherwise considered a Tax Resident of the UAE under the applicable legislation in the UAE.
UAE branches of domestic or foreign entities are an extension of their “parent” or “head office” and are not considered separate entities. A branch of a foreign entity registered in the UAE would, therefore, generally not be considered a Tax Resident of the UAE.
UAE tax residency criteria for individuals
A natural person shall be considered a Tax Resident in the State where any of the following conditions are met:
1. Has their usual or primary place of residence and the centre of his financial and personal interests in UAE
2. If he has been physically present in the State for 183 days or more within 12 consecutive months.
3. was physically present in the UAE for a period of 90 days or more, within the relevant 12 consecutive months, and is a UAE national, holds a valid Residence Permit in UAE or holds the nationality of any member state of the GCC, and meets any of the following:
a. He has a Permanent Place of Residence in the State.
b. He carries on employment or Business in the State.
How can we help?
- Determination of eligibility to receive a Tax Residency Certificate.
- Filling out tax residency application as per details provided
- Coordination with Authorities to obtain a Tax Residency Certificate.
Contact us at firstname.lastname@example.org for further assistance.
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