A Tax Resident Certificate also called as Tax Domicile Certificate is a legal document issued by the Ministry of Finance in UAE for the Individuals and Companies in the UAE, i.e. the an individual or company receives income in this country and pays taxes here in the UAE at the local rate (which is almost 0%). This document is required to take benefit of Double Taxation Avoidance Agreement (DTAA) for expats and entities in their home country.
UAE has signed the DTAA with over 100+ countries and thus many nationalities living in the UAE can benefit from Double Taxation. Double Taxation Avoidance Agreement also called as Tax Treaty, is a bilateral agreement between two countries that aims to eliminate or avoid double taxation of the same income in two countries.
In UAE, a Tax Resident Certificate can be obtained by an Individual person or by a Company. For an Individual to obtain the certificate, he or she must be a resident in the UAE and also having a substance in the UAE. In regards to the Company, only Free Zone and Mainland companies are eligible to apply for the Tax Resident Certificate. Offshore companies are not considered as tax resident in the country and thus are not eligible for the Tax Domicile Certificate.
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