As a part of an ongoing cooperation between UAE's Federal Tax Authority (FTA) and the Ministry of Finance, FTA is all set to issue both digital Tax Residency and Commercial Activities Certificates, in line with the Cabinet Decision No. 65 of 2020 on Fees for Services,via its e-services portal as of 14 November 2020.
There are two categories of tax certificates which are issued to companies and individuals :
1. Tax Residency Certificate - A certificate issued by the FTA upon request to enable applicants to benefit from Double Tax Avoidance Agreements (DTAA) signed between UAE and other countries .
2. Commercial Activities Certificate - A certificate issued by the FTA to enable applicants to refund VAT paid in advance outside the UAE, whether or not DTAAs are applicable.
The Authority clarified that eligible individuals can easily issue Tax Residency and Commercial Activities Certificates through a simple registration process via the Federal Tax Authority’s official website. The process is completed by submitting the required supporting documents and paying the fees specified in the UAE Cabinet Decision No. 65 for 2020.
The Authority clarified that via their online services portal, the user is directed to the login page to enter his/her username and password to log in, and upon successfully registering with the services portal, the user will be directed to the list of all requests related to tax certificates assigned to him/her, appearing in the control panel. The registrant has the opportunity to choose to submit one or several requests, and once selected his/her desired option, all the details of the request will appear and will be provided with the choice to approve, complete, reject or refund any taxes paid outside the UAE which allows for a tax refund. The registrant may download the attachments to verify the data, complete the process and follow-up the status of their request.
H.E. Khalid Al Bustani said: “Both Tax Residency and Commercial Activities Certificates allow investors in the UAE, including companies and individuals, to benefit from double taxation avoidance agreements to which the State is a party, with the aim of preventing duplication, in addition to recovering VAT imposed on Emirati businesses in various countries in the event they were registered with the Authority.”