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How To Become A Dubai Tax Resident In 2023?

Dubai, renowned as a thriving Gulf financial hub adorned with towering skyscrapers, an international airport buzzing with activity, and a strategic tax haven stands tall among global destinations. 

Over the past decade, its irresistible allure has attracted a multitude of ambitious professionals and astute entrepreneurs, enticed by the absence of direct taxes and the lucrative advantages offered by free trade zones. 

As GenZone, seasoned experts in seamless corporate relocations, we have facilitated numerous transitions to the United Arab Emirates, with Dubai and its esteemed free trade zones reigning as the pinnacle of ambition. 

Join us as we delve into the realm of taxation in Dubai and unravel the intricacies of securing coveted residency in this tax-free paradise.

Types of Taxes in Dubai

Dubai is renowned for its favourable tax environment, but it’s important to note that certain taxes still exist and must be adhered to by businesses and individuals. Here’s an overview of the taxes that may be applicable:

Corporate Tax:

In Dubai, the majority of businesses enjoy a corporate tax rate of 0%. However, specific sectors and foreign banks are subject to a maximum tax rate of 20%. To be exempt from corporate tax, businesses must obtain a Tax Residency Certificate issued by the Ministry of Finance. This requires compliance with Emirati law, the establishment within the UAE, and the presence of resident directors.

The tax rates are as follows:

  • Rate of up to 55% for oil and gas companies.
  • Rate of up to 20% for foreign bank branches.
  • 0% Tax Rate for all other companies and industries.

Thus, Corporate Tax in Dubai will generally be 0%.

Individual Taxes:

Residents of Dubai are not liable for personal income tax, inheritance tax, gift tax, or wealth tax. Moreover, the UAE has entered into 88 double taxation treaties, safeguarding individuals from being taxed twice on the same income, as well as adopting the Multilateral Instrument. However, individuals may still be subject to taxation in other jurisdictions, hence the importance of obtaining a Tax Residency Certificate. 

Individual tax obligations encompass a municipal tax of 5% on residential property, calculated based on the annual rental value, as well as a 5% Value Added Tax (VAT) imposed on certain consumable goods.

What is a Free Zone in UAE?

Free zones in the UAE are areas designated for businesses to set up with incentives such as tax exemptions, streamlined procedures and regulations, and other benefits. Free zones provide foreign investors with an opportunity to establish businesses and benefit from the country’s strategic location, open economy, and world-class infrastructure.

As an entrepreneur planning to set up a business in the UAE, selecting the appropriate freezone can be a daunting task due to the numerous options available. However, choosing the right one is crucial for the success of your venture. This blog post will guide you through our recommendations of the best freezones in the UAE, helping you make an informed decision on the most suitable location for your business, regardless of whether you’re a startup or an established enterprise.

Choosing the Ideal Free Zone in Dubai

When it comes to selecting a free zone in Dubai, the International Free Zone Authority (IFZA) stands out as an internationally acclaimed and cost-effective option. Notably, the IFZA imposes some of the least stringent requirements among all the Emirates.

With the IFZA, you have the convenience of establishing an online company, appointing non-resident directors, and swiftly opening a bank account, all with the necessary guidance and support.

How to get a Tax Residency in the UAE?

Gaining residency in Dubai is a straightforward process, offering three distinct avenues for eligibility:

  1. Employment Sponsorship: Residency can be acquired by obtaining sponsorship from an employer, which is typically renewed every three years.
  1. Real Estate Investment: Another option is to invest a minimum of $275,000 in Dubai’s real estate market, which grants you eligibility for residency.
  1. Free Zone Company Incorporation: Perhaps the swiftest and most cost-effective method is incorporating a company within a free zone in Dubai. This route offers numerous advantages and facilitates residency acquisition efficiently.

How can GenZone help you get a Tax Residency in UAE?

To make the most of the benefits of setting up your business in the UAE and obtaining a residence visa, it’s crucial to have a professional partner who can guide you through the process. Without their assistance, it can be challenging to navigate all the requirements. 

At GenZone we recognize your needs and have the expertise to help you establish your company in UAE successfully. We’ve helped many individuals make the move to UAE and enjoy its lifestyle and business benefits.

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