Tax Residency Certificate in UAE: Eligibility, Document and Process

A Tax Residency Certificate (TRC) in the UAE is an official document issued by the FTA that proves an individual or company is a UAE tax resident, enabling them to claim DTAA benefits and avoid double taxation.

Key Takeaways 

• TRC applies to both individuals (meeting 183-day or 90-day presence rules) and UAE-registered companies with active operations and management in the country.
• It is essential to claim DTAA benefits, reduce foreign withholding taxes, and prove tax residency to foreign authorities or banks.
• Offshore entities generally cannot obtain TRCs due to lack of sufficient UAE presence.
• Application is done online via the FTA portal with required documents and fees; approval typically takes 4–5 days.
• Valid for only one selected 12-month period must be renewed yearly with updated documents.
• TRC strengthens credibility and aids tax planning for international income.

What is a Tax Residency Certificate (TRC)? 

A Tax Residency Certificate (TRC) is an official certificate issued by the UAE Federal Tax Authority (FTA) confirming that an individual (natural person) or company (juridical person) is a UAE tax resident for a specific period. The TRC, also known as the “tax domicile certificate in UAE” is crucial if your income is subjected to taxation in more than one country. 

There are two main practical uses:

1. Treaty (DTAA) TRC: Used to claim benefits under a DTAA (e.g., lower withholding tax on dividends, interest, royalties, or exemption from foreign tax).
2. Domestic/Other-purpose TRC: Sometimes needed for banking, immigration, foreign regulators, or proof of tax residence even where a DTAA is not involved.

Note:

• The UAE also issues a separate Commercial Activities Certificate for VAT recovery abroad in some cases. This is different from a TRC but is applied for through the same portal.
• A double taxation avoidance agreement is a treaty signed between two countries, with significant cross-border transactions to avoid taxes on the same income. 

Who Can Apply for a Tax Residency Certificate in the UAE? 

The following individuals/entities are eligible to apply for a tax residency certificate TRC: 

For an Individual

• Must have a primary place of residence and centre of financial and personal interest in UAE. 
• You have been physically present in UAE for more than 183 days in the last 12 months, or
• You have been physically present in UAE for more than 90 days in the last 12 months but also fulfilled these conditions. These conditions are also valid for tax residency certificates for NRI in UAE. 
• UAE citizen, GCC National, or expatriate
• Permanent residence in UAE
• Work or conduct business in UAE.  

For a Legal Entity

• Recognised as a tax entity under UAE laws.
• Established as an entity in UAE.
• An entity with an establishment outside UAE but effective management control is with a person who is a tax resident in UAE. 
• Existence of a minimum of one year.
• Audited financial statements with certified accounting firms.

Note: Offshore companies cannot apply for a TRC certificate in UAE, as they don’t have a physical presence in the UAE. 

Who Must Get a Tax Residency Certificate (TRC)?

A TRC is required for UAE residents (individuals or companies) who need official proof of UAE tax residency, mainly to:

• Claim Double Taxation Avoidance Agreement (DTAA) benefits in another country.
• Reduce or avoid foreign withholding tax on dividends, interest, royalties, or overseas income.
• Prove tax residency to foreign tax authorities, banks, or regulators for compliance or reporting.

Tax Residency Certificate UAE Requirements

Notes: 

• Bank statements are no longer a strict universal requirement, but may still be requested case-by-case
• Audited financials may be requested for older companies; newer guidance allows flexibility depending on period and purpose

How to Apply for a Tax Residency Certificate in UAE: A Step-by-Step Procedure

Getting a TRC certificate in the UAE is not that typical. With these steps in mind, you can easily apply and obtain the TRC. 

1. Ensure you meet the eligibility criteria and residency requirements. 
2. Collect all the required documents and convert them into either PDF or JPEG format.
3. Apply online through the Federal Tax Authority portal. 
4. If you’re already a registered taxpayer, then enter your TRN and email address. 
5. If you’re a new taxpayer, then enter “NO” and fill in the required details.
6. Fill out the TRC registration application.
7. Upload your documents.
8. Pay the application fees
9. Once completed, the approval takes 4-5 days.
10. After approval, the TRC comes within 5-7 working days. 

Fee Payable for Tax Residency Certificate

• Submission fees: AED 50
• Tax registrants: AED 500 (individuals and companies)
• Non-tax registrants but individuals: AED 1000
• Non-tax registrants but companies: AED 1750 
• Additional AED 250 for a hard copy of the certificate. 

Validity and Renewal of a TRC

A Tax Residency Certificate is issued for a specific 12-month period and is valid for one year only. The validity is tied to the period you select in your application (for example, a calendar year like Jan–Dec, or any rolling 12 months), and the certificate confirms tax residency only for that stated period. Because of this, a TRC cannot be reused for future years or different periods.

• A TRC is valid for one year only and covers the exact 12-month period selected in your application.
• It proves UAE tax residency only for that stated period and cannot be reused for future years.
• You cannot apply for a future period - only past or current periods where residency conditions are already met.
• There is no auto-renewal; renewal requires a fresh application every year through the same portal.
• For renewal, you must upload updated documents for the new period (e.g., new ICA travel report for individuals, renewed trade license for companies).
• Foreign tax authorities typically require a current-year TRC for DTAA claims, so older certificates may not be accepted.

How to Download a Tax Residency Certificate? 

You can download the tax residency certificate in the following way: 

• Log in to the EmaraTax TRC portal.
• Go to My Requests / Certificates.
• Open the approved TRC request.
• Download the PDF certificate.
• If you want a physical certificate, request it and pay AED 250 per copy.

Benefits of Getting a Tax Residency Certificate

Some of the prominent benefits of getting a tax residency certificate are as follows:

• To take advantage of the double taxation avoidance agreement (DTAA)
• The TRC strengthens an individual’s/business’s credibility in the eyes of authority.
• Avail the benefits of withholding taxes on dividends, royalties, interest, and other such income.
• Planning and structuring of tax liabilities efficiently.
• Accessing foreign markets effectively without the liability of added taxation. 

Conclusion

To wrap this up, a tax residency certificate in UAE is a benefit that individuals/legal entities can avail to maximise their credibility and avoid double taxation. The application process is a straightforward approach without any complexities. By submitting the required documents and fees, individuals and entities can avail of tax treaty benefits and ensure they’re complying with the relevant laws and regulations.