Double Taxation Avoidance Agreement (DTAA)
A Double Taxation Avoidance Agreement (DTAA) is like a special deal between two countries. It's made so that people doing business in both places don't have to pay taxes twice on the same income.
For example, let's say you're a businessman from Germany, but you also make money in United Arab Emirates (UAE). Without a DTAA, both countries might want you to pay taxes on the money you made in UAE. That's not fair, right?
So, the DTAA is there to make sure that doesn't happen. It sets rules about which country has the right to tax what income. This way, you only pay tax once.
This is great for businessmen because it means they can do business in different countries without worrying about extra taxes. It can save them a lot of money and makes doing business overseas easier and more profitable.
DTAA and UAE
Individuals who are residents or nationals of the UAE, as well as companies residing in the UAE, can benefit from a comprehensive and expanding network of Double Taxation Agreements (DTAs). These DTAs can provide tax relief in partner countries. The list below shows the DTAs currently in effect. There are also several other DTAs in various stages of negotiation and ratification.
| Albania | Guinea | Pakistan |
| Algeria | Hong Kong | Panama |
| Andorra | Hungary | Paraguay |
| Angola | India | Philippines |
| Argentina | Indonesia | Poland |
| Armenia | Ireland | Portugal |
| Austria | Israel | Romania |
| Azerbaijan | Italy | Russia (Gov. Institutions only) |
| Bangladesh | Japan | Saudi Arabia |
| Barbados | Jersey | Senegal |
| Belarus | Jordan | Serbia |
| Belgium | Kazakhstan | Seychelles |
| Belize | Kenya | Singapore |
| Bermuda | Korea | Slovakia |
| Bosnia and Herz. | Kosovo | Slovenia |
| Botswana | Kyrgyzstan | South Africa |
| Brazil | Latvia | Spain |
| Brunei | Lebanon | Sri Lanka |
| Bulgaria | Liechtenstein | St. Vincent & the Grenad. |
| Cameroon | Lithuania | Sudan |
| Canada | Luxembourg | Switzerland |
| China | Malaysia | Syria |
| Comoro Islands | Maldives | Tajikistan |
| Costa Rica | Malta | Thailand |
| Croatia | Mauritania | Tunisia |
| Cyprus | Mauritius | Turkey |
| Czech Republic | Mexico | Turkmenistan |
| Egypt | Moldova | Ukraine |
| Estonia | Montenegro | United Kingdom |
| Ethiopia | Morocco | Uruguay |
| Fiji | Mozambique | Uzbekistan |
| Finland | Netherlands | Venezuela |
| France | New Zealand | Vietnam |
| Georgia | Niger | Yemen |
| Greece | Macedonia | Zimbabwe |
The UAE has established around 115 DTAs with most of its trade partners to promote its development objectives.
So, how can this benefit you?
Well, you might have heard about companies in free trade zones. Some of the best ones are in the UAE, where there are over 40 such zones. If you own a company in a UAE free trade zone, you can do business with most of countries and not pay any taxes.
That's right, 0% taxes!
This is also an option for individuals. However, it is not as simple as it is for companies.
Here are criteria for so called "Taxation Residency Certificate (TRC)" for individuals or natural person (UAE Residents):
The applicant must have resided in the UAE for a minimum of 180 days. They must also have an officially documented annual lease agreement, such as EJARI in Dubai, or with municipalities in other Emirates and free zone authorities.
If you meet these criteria and are interested in obtaining a TRC in the UAE, our team is prepared and eager to assist you.
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