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Tax residency in the UAE is a critical consideration for individuals, especially expatriates or digital nomads. In its recent guide, Tax Resident and Tax Residency Certificate, the FTA has elaborated the concept of residence in the UAE for natural persons as well as juridical persons.
This article provides an overview of the conditions under which a natural person is considered as a UAE resident.
Natural Persons
A natural person is considered a tax resident in the UAE if they meet one of the following conditions:
- They were physically present in the UAE for 183 days or more in a consecutive 12-month period;
- They were physically present in the UAE for 90 days or more in a consecutive 12-month period and meet the following criteria:
o they are nationals of the UAE or Gulf Cooperation Council (GCC), or hold a valid UAE Resident Permit, and
o they have a permanent place of residence in the UAE, or carry on an employment or Business in the UAE;
- Their usual or primary place of residence and centre of financial and personal interests were in the UAE.
183-Day and 90-Day Physical Presence Tests
The most common criterion for determining tax residency for natural persons is the 183-day physical presence test. For individuals who do not meet the 183-day threshold, the 90-day test provides another option. Let’s understand with the help of examples.
Fatima, a foreign national with a UAE residence permit, spent 95 days in Dubai in 2024. She has a permanent place of residence in her sister’s apartment. Despite not owning the property, Fatima’s continuous access to the apartment allows her to qualify as a tax resident under the 90-day test.
Aria, a citizen of Country R, moved to the UAE five years ago with her family. Although she maintains some financial ties to her home country, her centre of financial and personal interests is now in the UAE, where she owns a home, works full-time, and has social connections. She will be considered as a resident in the UAE.
Exceptional Circumstances
In some cases, individuals may be physically present in the UAE for reasons beyond their control. Exceptional circumstances, such as medical emergencies or natural disasters, may allow individuals to disregard certain days spent in the country when calculating residency.
For instance, Nicholas was due to leave the UAE after spending 180 days there in 2025, but a sudden illness forced him to remain in the country for an additional week. Despite surpassing the 183-day threshold, the additional days are disregarded due to his medical emergency, preventing him from being classified as a UAE tax resident.
Tax Residency Certificate
A Tax Residency Certificate (TRC) can be obtained for claiming tax benefit under the Double Taxation Agreements (DTAs). It is a certificate issued by the FTA proving that a person is a tax resident in the UAE. The TRC is available for a particular tax period (the calendar year for natural persons). The FTA’s guide provides details of the manner of procuring TRC from the FTA.
Conclusion
Determining tax residency in the UAE involves a detailed examination of physical presence and economic ties. Whether through the 183-day test or the 90-day alternative, individuals must carefully consider these rules to comply with UAE tax laws and benefit from applicable international treaties.
Determining tax residence can pose serious challenges to a globally mobile workforce. Hence, companies or employers often outsource these matters to professional experts.
Disclaimer: Content posted is for informational and knowledge sharing purposes only, and is not intended to be a substitute for professional advice related to tax, finance or accounting. The view/interpretation of the publisher is based on the available Law, guidelines and information. Each reader should take due professional care before you act after reading the contents of that article/post. No warranty whatsoever is made that any of the articles are accurate and is not intended to provide, and should not be relied on for tax or accounting advice
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