OBTAINING TAX RESIDENCY CERTIFICATE FOR A COMPANY

Why should I obtain a Tax Residency Certificate for my UAE company?

Tax Residency Certificates are crucial in substantiating your UAE company’s tax residence in the UAE.

They are particularly important where the shareholders and / or directors of the company have a non-UAE connection or international tax exposures, and in certain circumstances can be a powerful tax planning tool for companies who are able to obtain these certificates from the Ministry of Finance.

Tax Residency Certificates are essential for the purposes of benefiting from the large number of double tax treaties in force between the UAE and other jurisdictions and confer a few additional benefits to holders.

You can also apply for Tax Residency Certificates as an individual, and these certificates can help reduce your tax exposures on certain international investments.

How is it possible for a UAE company to obtain a

Tax Residence Certificate from the Ministry of Finance?

There are several requirements that your UAE company must meet for you to obtain a UAE Tax Residency Certificate from the Ministry of Finance. One requirement which has recently come into the spotlight is the need of a physical office space.

Whilst in the third quarter of 2018 we still managed to obtain Tax Residency Certificates for companies operating from Flexi Desk offices (or similar facilities) across the various free zones in the UAE, the Ministry of Finance are now scrutinizing such cases in further detail.

Due to various international jurisdictions’ stringent requirements on substance, amongst other considerations, when determining the tax residency of companies incorporated in foreign jurisdictions, the Ministry of Finance is now getting stricter when reviewing Tax Residency Certificate applications from companies and are generally requiring such companies to have a physical / permanent office space. We have witnessed a number of recent applications being rejected where companies simply maintain a Flexi Desk office or similar space.

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