The certificate is issued for the following reasons:
- It helps applicants avoid paying taxes in two or more countries.
- It proves that the applicant is residing in the UAE.
- It makes the process of cross-border trade and investment easier.
- It helps diversify the economy.
It encourages development in the UAE.
Why is it important?
It helps the government know which country a person is a tax resident of. This is mandatory mainly for those who earn incomes from two or more countries. It is crucial as it ensures that one does not break any laws and face legal ramifications.
If a person does not apply for a tax residency certificate, they could be forced to pay the tax for all the countries they operate in. Failure to make the payment could be counted as tax evasion and may result in asset seizure and imprisonment.
A person can be a tax resident in one country, and it has to be noted that it does not always exempt them from taxes in others. For example, some countries do tax income earned by foreigners regardless of where their tax residence is.
How to apply for it?
Individuals can apply for the certificate by themselves; however, this can be a time-consuming process. You can submit the documents to us, and we will handle the rest of the application process on your behalf. Our team is equipped with thorough knowledge of the process. We will deliver the certificate to you within a short period.