A Tax Residency Certificate (TRC) is an important document for individuals and companies in the UAE, serving as proof of tax residency status. This certificate can help in avoiding double taxation and can be beneficial for financial and business transactions. Here’s what you need to know about TRCs for both personal and corporate entities.

What is a Tax Residency Certificate (TRC)?

A TRC is an official document issued by the UAE’s Federal Tax Authority (FTA) that confirms an individual or a company is a tax resident of the UAE. This certificate can facilitate tax benefits and exemptions, especially in jurisdictions that have a double taxation agreement (DTA) with the UAE.

Eligibility Criteria

For Individuals (Natural Persons):

1. Physical Presence: The individual must reside in the UAE for at least 183 days within a 12-month period.
2. Emirate Residency: The applicant must hold a valid residency visa issued by the UAE.
3. Purpose: The TRC is typically required for personal income tax purposes in other countries.

For Companies (Legal Persons):

1. Business Establishment: The company must be incorporated and legally registered in the UAE.
2. Substantial Activity: The company should demonstrate substantial business activity in the UAE.
3. Operational Presence: There must be a physical office or location in the UAE.

Requirements to Obtain a TRC

For Individuals:

• A copy of the valid residency visa.
• A copy of the passport.
• Proof of residence (e.g., utility bill or lease agreement).
• A completed TRC application form.

For Companies:

• A copy of the trade license.
• A copy of the company’s registration documents.
• Financial statements for the previous year.
• Details of the business activities conducted in the UAE.
• A completed TRC application form.

Note: Additional documents may be requested by the FTA during the application review process, depending on individual circumstances.

Basic Procedures to Obtain a TRC

1. Online Application: Both individuals and companies can apply for a TRC through the FTA’s online portal. Registration on the portal is required.
2. Submission of Documents: Applicants must upload the required documents and complete the application form accurately.
3. Payment of Fees: A fee is applicable for the processing of the TRC, which varies based on the type of application.
4. Approval Process: After submission, the FTA will review the application. Processing times can vary, so it’s advisable to apply well in advance of any deadlines.

Conclusion

Obtaining a Tax Residency Certificate in the UAE is essential for both individuals and companies looking to benefit from tax treaties and avoid double taxation. Understanding the eligibility criteria, required documents, and application procedures will help streamline the process.

Our experienced team at KAIDZEN BIZ can guide you through the process, ensuring that you meet all requirements for a successful application.

Got questions? Reach out to our team – we’re here to help!