Navigating Double Taxation Treaties and Agreements: Benefits for UAE-based Multinational Companies

Dubai has an attractive tax benefits regime, and foreign investors who choose to set up a company in Dubai can choose to set up a company in Dubai between the UAE and other countries to avoid double taxation agreements on UAE-based companies with branches within or outside Dubai. You can also benefit from double taxation agreements concluded in. If you are a foreign investor, it is helpful to know whether there is a double taxation agreement between the UAE and your country. Our Dubai lawyers can provide you with comprehensive information regarding double taxation agreements entered into by the United Arab Emirates. Additionally, our team can assist foreign investors in establishing a company in the UAE.

Double Taxation Treaties And Agreements In UAE

The first double taxation agreement was signed between the United Arab Emirates and France. Since then, the Emirates, including Dubai, has signed 92 double taxation treaties with countries across the world.

The List Of Double Tax Avoidance Agreements Includes:

Albania, Algeria, Armenia, Austria, Azerbaijan, Andorra, Belarus, Benin, Belize, Bangladesh, Bermuda, Barbados, Bosnia and Herzegovina, Belgium, Mauritius, Canada, Bulgaria, China, the Czech Republic, Egypt, Estonia, Ethiopia, Cyprus, Finland, Fiji, Georgia, Gambia, New Guinea, Germany, Greece, Hong Kong, Italy, India, Ireland, Japan, Kazakhstan, Kyrgyzstan, Kenya, Indonesia, Lebanon, Luxembourg, Latvia, Liechtenstein, Lithuania, Malaysia, Macedonia, Malta, Mongolia, Montenegro, Morocco, Mauritius, Mauritania, Mozambique, Mexico, the Netherlands, New Zealand, Nigeria, Pakistan, Philippines, Poland, Portugal, Palestine, Panama, Romania, Russia, Seychelles, Singapore, Senegal, Switzerland, Spain, Serbia, Slovenia, Slovakia, Sri Lanka, South Korea, South Africa, Sudan, Syria, Tajikistan, Thailand, Turkmenistan, Tunisia, Turkey, New Zealand, Ukraine, Uzbekistan, Uruguay, Uganda, Venezuela, Vietnam, Yemen.

If you are from any of the above countries and are planning on immigrating to Dubai, our lawyers can help you with corporate tax UAE.

What Do The Double Tax Treaties In The UAE Contain?

Even if personalized, most of Dubai’s agreements for the avoidance of double taxation will contain provisions about the following:

  1.  the taxation of income of individuals and UAE-based companies, as most agreements cover the income taxes applied by the contracting states;
  2.  methods of elimination of double taxation, which are usually different for each country;
  3.  reduced tax rates for certain types of incomes ( capital gains, for example);
  4.  tax reductions for investments made by the governments of the contracting states;
  5.  exemptions for the taxes levied on air transportation and shipping. 

All double taxation treaties are created to help Dubai build better international relations with its economic partners. You can always contact our Dubai lawyers for further information. You can also contact an immigration lawyer in Dubai for assistance with immigrating to the UAE.

What Income Is Covered By The DTA Signed By The UAE?

The most important income protected by the double taxation agreements that the UAE has concluded with the countries listed above are:

  1. Dividends, royalties, and interest will be borne by his DTT in Dubai.
  2. Revenues from air and maritime transport are subject to double taxation agreements.
  3. Registered proceeds from the sale of immovable property or property are part of the provisions of the DBA.
  4. Income from personal services is protected by the UAE double tax treaty. 

If you would like to understand more about the double taxation treaty provisions in the UAE, please feel free to contact our legal team, who can also assist you with immigration to Dubai. 

Can DBA Cover The Dubai Free Zone?

Yes, UAE-based companies with establishments and activities in the Dubai Free Zone can benefit from the provisions of double tax benefits treaties signed by the UAE. We would like to remind you that foreign investors can have 100 percent ownership of UAE-based companies established within Dubai’s free zones. We will be happy to provide you with detailed information on how to carry out activities in Dubai’s free zones.

Information About Double Taxation Agreements In Dubai

Foreign investors should note that taxes paid in Dubai can be claimed in the foreign company’s home country as a credit against taxes paid in the UAE, subject to the provisions of double tax benefits treaties and the applicable law of the home country. If you would like to know more about the valid agreements concluded between Dubai and your country, a Dubai lawyer can provide you with specific information regarding the provisions of each double taxation agreement. 

 Terms Of The DTA Signed With Canada

The double taxation agreement signed by the UAE and Canada protects residents and UAE-based companies based in these countries from income taxation upon registration of a permanent establishment. Royalties, capital gains, and dividends may be taxed in the UAE or  Canada, as the case may be. As an example, if a Canadian company operates also in the United Arab Emirates and makes profits that are taxable in that country, the company can claim the tax benefits amount in the form of a credit in its home country.

The United Arab Emirates and Canada have enjoyed strong economic ties for many years. However with double taxation agreements in place to strengthen business ties between the two countries. If you need clarification to better understand the double taxation agreement concluded between Canada and the United Arab Emirates, we would like to remind you that you can contact a lawyer in  Dubai for legal assistance.

Terms Of DTA Signed By UAE With China

Another important and strategic partner of the UAE is China, with which a double taxation agreement was required and implemented. Double taxation agreements were signed in 2014 for the purpose of income protection and certain tax exemptions. Eliminating tax evasion is another reason for signing a DTT between the UAE and China. For example, tax credits may be provided to  Chinese UAE based companies that pay taxes in the UAE. It is important to note that the tax relief applies to UAE- based companies and relates to income from dividends, interest and royalties.

Combating tax benefits evasion has always been a focus of  UAE authorities. And double taxation agreements play an important role in the business environment. And the agreement signed with China is no exception. If you are a Chinese investor and would like to know more about the double taxation clauses you have signed with the UAE, we recommend that you contact a lawyer in Dubai. 

What Are The Terms Of The DTA Signed With India?

As India is also an important business partner of the UAE,  the double taxation agreement signed in 1993 plays a key role in the direction of business between the two countries. As far as the provisions of the Double Taxation Agreement signed between the United Arab Emirates and also India are concerned, a company with a branch office in any of these countries can only pay taxes in one of these two countries.

If a company pays taxes in both countries. It can receive tax deductions in its home country (in this case, India). It is important to know that any changes to the tax system. Whether in the UAE or India, must be reported in a timely manner as per the provisions of the double taxation agreements signed by the above countries. We remind you that royalties, interest, dividends, real estate income and personal income are protected by the provisions of the Double Taxation Treaty signed between the United Arab Emirates and India.

 UAE And Turkey Sign DTA 

 Economic cooperation between the UAE and Turkey has a long history. And the need to sign a double taxation agreement was self-evident. He noted that in 1994, the two countries signed an agreement to avoid double taxation and new provisions. Were added a few years later. Taxes subject to the UAE’s double taxation agreement with Turkey include dividends, royalties, interest, pension funds, personal income and real estate income. To better understand the provisions of the Double Taxation Agreement signed between the UAE and Turkey. Seek support and legal advice from a Dubai lawyer.

Why Invest In Dubai?

Excellent business conditions and diverse investment opportunities, especially in the United Arab Emirates and Dubai. Are critical to your decision to start and grow your business in a healthy and rewarding business location. However An attractive tax regime, investment opportunities in most industries. And a high standard of living are also reasons why Dubai ranks among the top business destinations. You can also find facts, information and statistics about doing business in the UAE here.

 1. According to a report by the Dubai Investment Development Authority. India is set to become the second-largest investor country in the UAE. 

2. According to the 2019 Doing Business report, the UAE is ranked 11th out of 190 countries worldwide.

3. FDI inflows recorded by the  UAE in 2018 were USD 10.385 billion.

Four. In 2018, approximately 378 greenfield investments were registered in the UAE.

If you would like to know more about investing in Dubai, please contact our Dubai Law Firm.

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