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Tax Residency Certificates (TRC)
For individuals who are residing and working across more than one nation, the issuance of double taxation can arise. This means paying taxes on the same income in both nations. However, in the UAE, such individuals might be exempted from paying tax with the help of a Tax Residency Certificate (TRC). It is executed under the agreement signed by several nations with whom the UAE has maintained diplomatic and economic relations under the Double Taxation Avoidance Agreement (DTAA). Therefore, through this, one can easily navigate the complex world of international taxation.
Hisab Taskmaster CAdvisors is one of the leading firms in Dubai, UAE, that helps individuals or businesses get their Tax Residency Certificate (TRC). Our professionals will handle all the documentation, approvals, and licensing procedures to make sure that you get your certificate as quickly as possible. We will guide on every step and make sure that you experience a successful certificate application. This will further enhance your international business operations, tax management techniques, and boosts international economic flourishment.
What is a Tax Residency Certificate (TRC)?
A Tax Residency Certificate (TRC), also known as a Tax Domicile Certificate (TDC), is an official document that is issued to individuals or businesses by the Federal Tax Authority (FTA). This particular document verifies your tax residency status and confirms that you can get all the benefits that are covered under Double Tax Avoidance Agreements (DTAAs). This means that you can avoid taxation on the income that you have already paid outside the UAE. Therefore, a Tax Residency Certificate allows you to do more effective tax strategizing and gain both financial as well as economic advantages.
Types of Tax Residency Certificate in the UAE
There are two main types of UAE Tax Residency Certificates (TRCs):
1. Domestic TRC
This particular certificate is mainly utilized within the UAE premises. It can be very advantageous for several purposes, but it does not have a direct relation to global tax treaties.
2. TRC for DTA purposes (Double Tax Avoidance)
This type of Tax Residency Certificate is necessary for getting advantages under agreements that the UAE has signed with other nations to prevent a double taxation system.
Eligibility Criteria and Documents Required for Tax Residency Certificate in UAE
UAE presents strict rules for acquiring any license, approval, or certificate. Therefore, before you apply for anything, it is important to know its eligibility criteria and a list of documents to be prepared beforehand. Here is a comprehensive breakdown of who can apply for a tax residency certificate in the UAE:
1. Individuals
- The individuals must reside in the UAE primarily
- They must be registered and operating in the UAE
Documents Needed For Individuals:
- Passport
- UAE Visa
- Emirates ID
- Proof of UAE residence (utility bills/ tenancy agreement)
- Immigration report to verify days spent in the UAE.
- Latest salary certificate.
- Last 6 months’ bank statements.
2. Company
- The company must be registered in the UAE
- The company must have an active trade license and business operations in the UAE.
Documents Needed For the Company:
- Trade license
- Memorandum of Association (MOA)
- UAE bank statements for the last 6 months.
- Audited financial statements and tax returns.
- Immigration report of company representatives.
- Copy of the Government decision or trade license
- Copy of the Request letter by the government authority.
Hisab Taskmaster CAdvisors can help you with comprehensive documentation challenges. On your behalf, we can gather your documentation, assess it, and present it in front of the UAE taxation authorities.
How to Apply for a Tax Residency Certificate in UAE: A Step-by-Step Procedure
Applying for a Tax Residency Certificate is an easy task. But if you do not have enough knowledge regarding the same, you can get assistance from us. At Hisab Taskmaster CAdvisors, we will manage the application process for you. Here are the key steps:
- Fulfill the eligibility criteria and residency conditions
- Gather all the essential paperwork and convert it into either PDF or JPEG format.
- Submit the application through the official portal of the Federal Tax Authority in the UAE.
- If you are an already registered taxpayer, then you can provide your TRN and email address.
- If you are not a registered taxpayer, then select “NO” as your answer and fill in the required details.
- Fill out the TRC registration application.
- Attach your documents.
- Pay the application fees
- The application can take 4-5 working days to get approved.
- After the approval, you will receive your Tax Residency Certificate within 5-7 days.
How to Download a Tax Residency Certificate?
You can download the tax residency certificate in the following way:
After the FTA gets your application and fees, it verifies everything and approves it within 4-5 days. After that, you can download the TRC certificate by logging into the official portal on the FTA website. You can get the soft copy, but if you want a hard copy, then you need to pay additional charges of AED 500.
Validity and Renewal of Tax Residency Certificate in the UAE
From the date of issuance, the validity of a Tax Residency Certificate (TRC) in the UAE is usually one year. If you wish to claim tax residency benefits for than one year, reapply for a new TRC certificate. One can renew the certificate following the same steps as the initial application. This also involves submitting updated documents and paying any applicable fees. You can partner with us, our professional experts will take care of all the renewal procedures so that you can focus on your core business operations without worrying about taxation liabilities.
Benefits of Getting a Tax Residency Certificate (TRC) in the UAE
By acquiring a Tax Residency Certificate (TRC), one can experience a range of benefits in the UAE. These include:
1. Avoiding Double Taxation
One of the primary and significant benefits is avoiding double taxation under the Double Tax Avoidance Agreements (DTAAs) that the nation has already signed with more than 76 countries. These contracts help you to avoid paying double taxes on the same income, which further helps you save your hard-earned money.
2. Simplifying Import-Export Processes
Businesses that are engaged in importing and exporting goods can get immense benefits from TRC as it can support in acquiring several exemptions or minimizing rates on import and export charges in particular circumstances.
3. Lowered Withholding Tax Rates
Some nations charge hefty amounts on withholding taxation elements like dividends, interests, and royalties that are paid to non-residents. With the help of TRC, you can prove your UAE residency and might be eligible for minimized withholding tax rates under DTAAs.
4. Enhanced Business Reputation and Credibility
Having a TRC showcases your devotion to tax adherence in the stringent business environment of the UAE. This can further illustrate your business positively to potential partners, clients, and investors.
5. Legal Recognition of Tax Residency
The Tax Residency Certificate acts as an official document from the Federal Tax Authority (FTA). This proves your tax residency status in the UAE which is beneficial for various purposes such as banking services, or compliance requirements.
6. Simplified International Business
When you hold a Tax Residency Certificate (TRC), it becomes easy to carry out international business operations. Such certifications serve as key evidence for your regulatory adherence and build enhanced goodwill in the market.
How Hisab Taskmaster CAdvisors Can Help?
Acquiring professional tax advisory and guidance for your business governance is necessary. A reliable tax strategy provides a comprehensive overview of the business model and other key factors. With Hisab Taskmaster CAdvisors, you can simplify your tax liabilities adequately. We help you obtain a Tax Residency Certificate (TRC) in Dubai, UAE and prevent the obligation to pay double taxes on the same income. Therefore, partner with us to get access to knowledgeable staff who will make the overall job easier by getting the appropriate documents and certifications to complete the TRC process on time.
