Fta To Issue Tax Residency And Commercial Activities Certificates For Investors In The Uae Via Its E-services Portal

The Federal Tax Authority (FTA), in coordination with the Ministry of Finance (MOF), has completed its preparations to issue both digital Tax Residency and Commercial Activities Certificates, in line with the Cabinet Decision No. 65 of 2020 on Fees for Services provided by the Federal Tax Authority issued October 2020.

The Authority will begin receiving applications for the issuance of Tax Residency and Commercial Activities Certificates via its e-services portal as of 14 November 2020. 

The FTA explained that there are two categories of tax certificates which are issued to companies and individuals, the first being the ‘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 . The second is the Commercial Activities Certificate which is 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 emphasized that the new service provides advantages and ease for the issuance of certificates to those registered with the tax system, as all their data is available in the FTA database so they can apply for Tax Certificates through direct and quick digital procedures.

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.

His Excellency Khalid Ali Al Bustani, Director-General of the FTA, confirmed that this step is part of an ongoing cooperation between the FTA and the Ministry of Finance as a strategic partner to the Authority, noting that a joint working group from both entities have made the necessary arrangements to ensure a smooth transfer for the digital issuance of Tax Residency and Commercial Activities Certificates from the Ministry to the Authority.

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.”

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. These specified fees were set as a requirement to apply for the Tax Residency Certificate, as an application is reviewed for any normal or legal person that is not registered with the Authority and providing a print copy of the digital Tax Residence Certificate. 

The Cabinet Decision also set the fees required to apply for a Commercial Activities Certificate for businesses registered with the Authority, and to review the application and issue a digital Commercial Activities Certificate and to provide a print copy for the certificate that was issued.