Important Changes On Tax Residency Certificates Under Cabinet Resolution No. 57 of 2020
November 30,2020 / Haroon Juma / Economic Substance Regulation Blogs
On 10 August 2020, the UAE Cabinet of Ministers issued Cabinet Resolution No. 57 of 2020 (the “amended ES Regulations”) which replaces the original ES Regulations, along with updated Guidance clarifying the amended ES Regulations (Ministerial Decision 100 of 2020 dated 19 August 2020).
The amendments to the ES Regulations and Guidance introduces changes to the procedures and increased importance of Tax Residency Certificate supporting ESR exemption.
The UAE MoF has updated the information on its economic substance website (link Here).
As Documentary Evidence Under ESR
In addition to the normal application to provide benefits to other tax jurisdictions of tax residency status under the Double Tax Treaty arrangements, The amended ES Regulations introduce several exemptions to simplify the burden of compliance. In providing sufficient evidentiary proof of exemption under:
- Entities that are tax resident outside the UAE
The UAE entity will need to submit a tax residence certificate or other documentation issued by the tax authority in the foreign jurisdiction in which it claims to be a tax resident to justify that it is treated as a locally tax resident entity in that foreign jurisdiction.
Exempt entities must (i) file a notification and (ii) provide sufficient documentary evidence to substantiate and benefit from their exempt status.
New Administration & Processes
The body from where to obtain a TRC is also amended.
The UAE Federal Tax Authority has been appointed as the Assessing Authority for the ES Regulations. As such, TRCs are subject to revised processes and forms from 10th November 2020.
If you are a business or individual requiring assistance in obtaining your Tax Residency Certificate, as a FTA approved tax agent we provide complete service to prepare, submit and liaise with the Federal Tax Authority to successfully grant your TRC status.
Partner With SimplySolved
Serving over 200+ clients we know the challenges your business faces operating cost effective, compliant and efficient back office operations in Finance, Tax, Human Resources Management, IT and Marketing.
As an FTA Accredited Tax Agency with ISO 9001 Quality & 27001 Information Management Certification, we offer a quality-based approach to our services supported by dedicated team of certified professionals.
We support our clients with defined processes, platforms and expertise to deliver advisory, project and outsourced services in Accounting, Tax, Auditing, HRM, IT & Marketing. Our offerings are specially designed to meet the UAE Regulations to put you in control of your information, comply to the regulations and help you make better business decisions.