Rules Determining Tax Domicile in UAE
On 2 September 2022, The Cabinet issued Decree No. (85) of 2022 regarding requirements and conditions concerning who shall be treated as a resident and an eligible taxpayer in the territory. And it shall enter into force on 1 March 2023.
Thus, it stipulates that the juristic person shall be considered an eligible taxpayer if its establishment has been done on the territory of the UAE and in accordance with the territory’s effective regulations and provisions or its effective Tax Law.
However, natural persons shall fulfill one of the following to be considered eligible to pay taxes:
- Their usual or essential domicile and personal financial benefits are in the territory of UAE, or they are fulfilling the requirements and conditions defined by the competent Minister’s decree.
- Existence of a person in the territory of UAE for a period of (183) one hundred eighty-three days or more within the relatable period of (12) twelve months consecutively.
- Actual existence of a person in the territory of UAE for a period of (90) ninety days or more within the period of relatable (12) twelve months and carries the nationality or having a valid residence license, or carries the nationality of any of the country members of Corporation Council for Arab States of the Gulf on condition of having a usual domicile, job, or any other works in the country.
The Decree states in article No. (5) the conditions for issuing the Certificate of Tax Domicile for the resident taxpayers, and the Federal Tax Authority’s power to enforce the provisions of the Decree such as receiving the concerned documents and information from the taxpayers and the governmental entities in the territory of UAE.
The Federal Tax Authority shall issue all the clarifications and instructions in order to apply this Decree’s provisions, and the competent Minister shall issue the conditions and the restrictions for implementing any of its provisions.