# Criteria for becoming tax resident in UAE



## oyly (Jun 6, 2013)

Hi

Been trying to find the requisites for becoming a tax resident of Dubai / UAE, but not found anything so far... It seems for most other countries you would at least need to be 183 days in a year in the country.

Anybody know what the rules are for Dubai?

Cheers!


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## fcjb1970 (Apr 30, 2010)

Because Dubai has no income tax, if you are a resident and work for a company here you get paid here. There are no tax forms to file. Any tax regulations are associated to your country of citizenship. As example, as a US citizen I have to meet certain obligations to claim exclusion of some of my income from US taxes. Others countries operate differently. Some I don't think require foreign resdients to file taxes at all. I believe Norway has pretty strict rules for claiming income earned out of country, but I don't really know any specifics


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## oyly (Jun 6, 2013)

fcjb1970 said:


> Because Dubai has no income tax, if you are a resident and work for a company here you get paid here. There are no tax forms to file. Any tax regulations are associated to your country of citizenship. As example, as a US citizen I have to meet certain obligations to claim exclusion of some of my income from US taxes. Others countries operate differently. Some I don't think require foreign resdients to file taxes at all. I believe Norway has pretty strict rules for claiming income earned out of country, but I don't really know any specifics


The reason I'm asking is that in order to get the status as "fiscally emigrated" in Norway, I would need to provide proof that I am considered a tax resident in another country. So I would still need a document like that from Dubai, even if they don't have income tax...


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## Stevesolar (Dec 21, 2012)

oyly said:


> The reason I'm asking is that in order to get the status as "fiscally emigrated" in Norway, I would need to provide proof that I am considered a tax resident in another country. So I would still need a document like that from Dubai, even if they don't have income tax...


Hi

A copy of your employment contract, visa in passport and UAE ID card would probably be sufficient to prove you are resident and working in UAE.

Cheers
Steve


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## oyly (Jun 6, 2013)

Well, there's the catch. I wouldn't be working in the UAE. I work on offshore oil rigs, anywhere in the world, and I would be staying in the UAE in my off periods. So my employment contract wouldn't prove much!


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## de Mexicaan (Apr 16, 2012)

oyly said:


> Well, there's the catch. I wouldn't be working in the UAE. I work on offshore oil rigs, anywhere in the world, and I would be staying in the UAE in my off periods. So my employment contract wouldn't prove much!


I think this is sth specific for Norway, it is probably better to ask the tax department in Norway what would be sufficient proof.


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## fcjb1970 (Apr 30, 2010)

It seems to me you have figured out why your country requires such a document. They want to keep people from doing what you are trying to do, claim to live somewhere with little or no taxes to avoid paying taxes in your country.

In the scenario you describe, you are just on holiday in Dubai when not working, you are not a resident and so will not receive any tax benefits of being a UAE resident


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## ziokendo (Jan 7, 2012)

oyly said:


> Hi
> Been trying to find the requisites for becoming a tax resident of Dubai / UAE, but not found anything so far... It seems for most other countries you would at least need to be 183 days in a year in the country.
> Anybody know what the rules are for Dubai?
> Cheers!


As you've been told this will depend strictly on your country laws, as there is no such thing as personal tax in Dubai.

For example being Dubai in italian govt "tax haven blacklist", for me I need to actually demonstrate both that :

1) I live here for most of the year (the more solid proof the better, ie employment residency with entry stamps plus other documents like consulate registration, your house rental contract, car registration/insurance, school bills of your children, gym bill, etc).
Any proof that I still have "the focus of my personal interests" back in Italy (like having a car registered there, an un-rented house, a local bank account, my wife living there, etc) would put me in a risky situation.

2) That my income is generated abroad (so a local employment contract, bank statements demonstrating salary credited, etc).

Despite this if I wish to wire money back home over a certain amount (10,000€/year) that would be very risky, I would need to submit a specific declaration.

Given the complexity of such regulation you should approach a tax consultant back home, rather than in Dubai, to understand how it works in Norway.


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## stamboy (Apr 1, 2013)

fcjb1970 said:


> It seems to me you have figured out why your country requires such a document. They want to keep people from doing what you are trying to do, claim to live somewhere with little or no taxes to avoid paying taxes in your country.
> 
> In the scenario you describe, you are just on holiday in Dubai when not working, you are not a resident and so will not receive any tax benefits of being a UAE resident


Sounds right


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## Canuck_Sens (Nov 16, 2010)

oyly said:


> Well, there's the catch. I wouldn't be working in the UAE. I work on offshore oil rigs, anywhere in the world, and I would be staying in the UAE in my off periods. So my employment contract wouldn't prove much!


Call the tax office in your town and just ask a simple question : if I have operations in a country that has no taxes like the countries in the Middle East and I am living there how can I proof that I have emigrated ? Would residency visa and company papers be enough? In this case you have company here in Dubai. If you have more else where then go after a tax consultant really.

If they tell you that you still gotta pay, then just ask this: ok, that means that ..should I need to go back home I am entitledfor social benefits as a tax contributor, right?

Fair is fair. Rules are there to protect most not you alone. You should not be afraid to call up the tax guys and inquire they will realize that a business decision depends on this and of course you can rely on any strategy to pay less taxes lawfullyand a tax consultant may be able to find legitimate "tax loop holes"


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## twowheelsgood (Feb 21, 2013)

I can't speak for Canada or Norway but the UK adopts the reverse approach of determining whether you are 'resident for tax purposes in the UK'. Once they determine that you are not (with a rather overly complex set of rules written by someone with a poor grasp of the English language) then they don't care where you are.

So once you are not resident, you don't have to get anyone to say where you reside.


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## stamboy (Apr 1, 2013)

Do you need to be resident in Dubai to be employed not self employed by a dubai company and paid by them?

if for example, would it be possible to be employed by du here but live overseas and work remotely? how would that work from a residency and tax perspective? would it even be legal?


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## taeli (Aug 24, 2011)

You can get a TRC tax residence certificate, issued by the ministry of finance.
You can google the criteria.
A good tax advisor, for exanple KPMG, can apply for you. Cost is appx 1.500$ for one year


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## Malbec (Jan 2, 2014)

Tax residency certificate here:
- you have to be employed for at least one year
- unemployed residents won't get it



stamboy said:


> Do you need to be resident in Dubai to be employed not self employed by a dubai company and paid by them?
> 
> if for example, would it be possible to be employed by du here but live overseas and work remotely? how would that work from a residency and tax perspective? would it even be legal?


Do you mean to have a tax free company here and live in UK? NO, it will not work legally, this is called tax evasion but it depends on the country itself you are going to be a resident of. If you meant "DU" as telecom operator, which would deploy you overseas to UK for instance, then you may not be liable for UK taxes.


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## stamboy (Apr 1, 2013)

I was just quoting DU as an example. The direct employer, DU in this instance would be the person paying me, i.e. no change from present direct employer if that makes any sense at all.


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## Malbec (Jan 2, 2014)

stamboy said:


> I was just quoting DU as an example. The direct employer, DU in this instance would be the person paying me, i.e. no change from present direct employer if that makes any sense at all.


You need to have work permit and to get a work permit you need residence visa. So yes you need to have a residence visa to be employed by UAE company (not self employed), but a residence visa does not mean that you are a resident if that makes sense. As long as you spend 1 day on every 180 days in UAE, your residence visa will be not expire, but it has nothing to do with a resident status.

If you are going to be in UK for the majority of the year, you are likely going to be treated as a resident for tax purposes. There is no DTA between UAE and UK, so no tax reliefs I am afraid. I would consult with UK tax specialist how to handle this in the best way.


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## stamboy (Apr 1, 2013)

Malbec said:


> You need to have work permit and to get a work permit you need residence visa. So yes you need to have a residence visa to be employed by UAE company (not self employed), but a residence visa does not mean that you are a resident if that makes sense. As long as you spend 1 day on every 180 days in UAE, your residence visa will be not expire, but it has nothing to do with a resident status.
> 
> If you are going to be in UK for the majority of the year, you are likely going to be treated as a resident for tax purposes. There is no DTA between UAE and UK, so no tax reliefs I am afraid. I would consult with UK tax specialist how to handle this in the best way.


Hi,

Thanks for the response and yes it does make sense. I was under the false impression that you must spend six months in Dubai out of a calendar year to maintain your residency visa.

Which begs the question, how do you maintain your work visa? Just by maintaining your residency visa?

I wasn't intending to work in the UK, as Im'm pretty sure that wouldn't be allowed. I was thinking more of Thailand as I have a house there.


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## Malbec (Jan 2, 2014)

stamboy said:


> Hi,
> 
> Thanks for the response and yes it does make sense. I was under the false impression that you must spend six months in Dubai out of a calendar year to maintain your residency visa.
> 
> ...


Work visa is tied to your residency visa, so yes, as long as you can keep your residence visa valid, this will keep your work permit valid too.

I think Thailand is quite flexible in terms of tax on foreign sourced income. It is based on remittance basis, so in theory you should pay tax on what you have transferred yourself to Thailand but my guess is no one pays it, people keep money out of Thailand and use ATMs...


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## stamboy (Apr 1, 2013)

Malbec said:


> Work visa is tied to your residency visa, so yes, as long as you can keep your residence visa valid, this will keep your work permit valid too.
> 
> I think Thailand is quite flexible in terms of tax on foreign sourced income. It is based on remittance basis, so in theory you should pay tax on what you have transferred yourself to Thailand but my guess is no one pays it, people keep money out of Thailand and use ATMs...


Many thanks and my understanding is that to keep your residency visa alive you must not be out of the country for six months consecutively, rather than the need to spend six months here is that correct? i.e. if you came back once a quarter for one week you would be fine, even though the total amount of time spent in the UAE is just 4 weeks in a year.

As for paying tax in Thailand, that is a separate matter, again my understanding is that you pay tax on the income you send over to Thailand in that particular year. I am researching this point along with work visas, but its the UAE issues around employment, residency, legalities that I am focusing on here. 

Not sure if there is a law that prevents a UAE company paying someone this way, as tax is normally deducted at source depending on the country you work in as normally you work in the country of the employer. This is slightly different in that it would mean as no tax deducted at source the individual is responsible for paying it, I guess in the same sort of manner that self employed people do, and US citizens who are based abroad.

thanks again for all your responses, I will certainly approach my boss and HR and see whether this is possible, it may be that they don't want me to work remotely so then thats the end of the subject. Still interesting one to find out about as others may benefit.


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## BedouGirl (Sep 15, 2011)

As long as you are here before the six month period is up, it's fine. Always count from the day you last entered to the day before the six months is technically up. I don't think there's too much of an issue over how long you stay for, but I'd imagine an overnighter would be best.


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## stamboy (Apr 1, 2013)

BedouGirl said:


> As long as you are here before the six month period is up, it's fine. Always count from the day you last entered to the day before the six months is technically up. I don't think there's too much of an issue over how long you stay for, but I'd imagine an overnighter would be best.


i would be coming here from time to time so that would be fine.

Interesting


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## Yussif (Jul 27, 2015)

BedouGirl said:


> As long as you are here before the six month period is up, it's fine. Always count from the day you last entered to the day before the six months is technically up. I don't think there's too much of an issue over how long you stay for, but I'd imagine an overnighter would be best.


It also might pay to not leave it quite as tight as that - sorry to point out the seemingly obvious but make sure you give yourself enough time accounting for delayed flights etc.


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