Tax Authority Releases Corporate Tax Guide for Non-Residents Earning Income in the UAE
The Tax Authority has published a new guide detailing the Corporate Tax obligations for non-residents who earn income in the UAE, providing essential information on registration requirements and tax compliance.
Clear Guidance for Non-Residents
This new guide aims to elucidate the criteria used to determine which non-residents are liable for Corporate Tax in the UAE. It includes a straightforward explanation of the instances that necessitate registration for Corporate Tax purposes, the calculation of taxable income, and other compliance requirements.
Comprehensive and Accessible Information
The guide is designed to be comprehensive yet accessible, offering general guidance to non-resident individuals and legal entities on their Corporate Tax responsibilities. It is a valuable resource for anyone who earns income in the UAE, whether they conduct business directly or indirectly in the country.
Practical Examples to Aid Understanding
The Tax Authority has included numerous practical examples in the manual to demonstrate how the Corporate Tax system applies to non-resident natural and legal persons. These examples are intended to simplify the understanding of key elements and facilitate compliance with the Corporate Tax Law.
Specific Cases for Non-Resident Tax Liability
The guide outlines specific scenarios where non-residents are subject to Corporate Tax. For individuals, this includes those with a permanent establishment in the UAE exceeding a turnover of AED 1 million during a calendar year, as well as those deriving state-sourced income. For legal entities, the criteria extend to those with a permanent establishment, state-sourced income, or a nexus in the UAE through ownership of immovable property.
Registration and Tax Registration Number (TRN)
Non-resident legal entities with a permanent establishment or a nexus in the UAE are required to register for Corporate Tax purposes and obtain a TRN. However, non-resident legal entities deriving only state-sourced income without a permanent establishment or nexus are not required to register. Similarly, non-resident individuals must register if their permanent establishment’s turnover in the UAE exceeds AED 1 million within a calendar year.
