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Question Leaving Dubai

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sriracha

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Aug 25, 2022
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#1
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Let’s say I move to Dubai, create my own LLC with associated bank accounts for the LLC and for myself.

Should I get bored of Dubai and leave, can I keep the LLC and the bank accounts? Maybe I have to go back from time to time?
 
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#2
It's a complex question. You can keep everything, but if you move to a place with worldwide income taxations, and trigger tax residency there, both you and your company would be in theory be considered resident in that country. In practice, as of now, which could change anytime, as long as you keep your residency valid and spend some time in Dubai, UAE should not report you to the new place unless they have clear indications that you have moved to other countries. Let's say you make a monthly transfer from your personal account to a France account, that would be enough for a UAE bank, if they want, to suspect you have moved to france.
 
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#3
karishi said:
It's a complex question. You can keep everything, but if you move to a place with worldwide income taxations, and trigger tax residency there, both you and your company would be in theory be considered resident in that country. In practice, as of now, which could change anytime, as long as you keep your residency valid and spend some time in Dubai, UAE should not report you to the new place unless they have clear indications that you have moved to other countries. Let's say you make a monthly transfer from your personal account to a France account, that would be enough for a UAE bank, if they want, to suspect you have moved to france.
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Thanks!

Can you define "keeping residency valid" and "spend some time in Dubai"?

sriracha said:
Btw, I have a lifestyle where I don't trigger residency anywhere (I travel a lot).
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#4
At the moment "Keep residency valid" and "spend some time in Dubai" mean entering the country every 6 months. That should prevent CRS issues. If you spend 90 days and have a property or run a business, like having a freezone company, you should be able to get a tax certificate, which is what you would want, because, as long as you don't trigger residency rules anywhere and you have a tax certificate from Dubai, your money is clean and you can spend it anywhere, as you paid taxes in Dubai and you should not have paid taxes anywhere else.
If you don't get the tax certificate and don't trigger tax residency rules anywhere, you are technically a tax resident of the country where you were born. Normally not an issue, unless you move back to that country
 
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#5
karishi said:
At the moment "Keep residency valid" and "spend some time in Dubai" mean entering the country every 6 months. That should prevent CRS issues. If you spend 90 days and have a property or run a business, like having a freezone company, you should be able to get a tax certificate, which is what you would want, because, as long as you don't trigger residency rules anywhere and you have a tax certificate from Dubai, your money is clean and you can spend it anywhere, as you paid taxes in Dubai and you should not have paid taxes anywhere else.
If you don't get the tax certificate and don't trigger tax residency rules anywhere, you are technically a tax resident of the country where you were born. Normally not an issue, unless you move back to that country
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EXCELLENT advice, thanks!
 
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#8
Just one more thing to consider. If you stay 90 days/year in Dubai and get the tax residency certificate and then spend the remaining time in your home country - they can discard that tax residency certificate and tax you there if you've spent there more than 183 days. So, the best actual advice is to spend 183 days in Dubai.
 
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#9
JimBeam said:
Just one more thing to consider. If you stay 90 days/year in Dubai and get the tax residency certificate and then spend the remaining time in your home country - they can discard that tax residency certificate and tax you there if you've spent there more than 183 days. So, the best actual advice is to spend 183 days in Dubai.
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He stated that he would be travelling and not triggering tax residency anywhere else. This is a clear pre - requisite. You laso need to exit your country properly.
 
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#10
karishi said:
If you don't get the tax certificate and don't trigger tax residency rules anywhere, you are technically a tax resident of the country where you were born. Normally not an issue, unless you move back to that country
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This is incorrect advice except maybe for US, Eritrea and very few countries.
Most countries don't tax you based on being born there as long as you don't have any connections to that country any more like living there etc.
 
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#11
JimBeam said:
Just one more thing to consider. If you stay 90 days/year in Dubai and get the tax residency certificate and then spend the remaining time in your home country - they can discard that tax residency certificate and tax you there if you've spent there more than 183 days. So, the best actual advice is to spend 183 days in Dubai.
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Tax certificate is only one document of the many documents you will need to provide to tax authorities that challenge your residence, it's not conclusive.

You will need to provide rental contract, gym subscription, daily spending with your visa... So summarized they want to see you really lived there.

If you travel around keep all your flight tickets, hotel bookings, spending proof.. In this case it can become a bit more challenging if you don't have any fixed tax residence which your home country will request. If you don't pay taxes anywhere they can indeed claim you should pay taxes in your country of citizenship.

If you have no assets in your country of citizenship or EU if you are from EU you will be quite safe, it's not easy for them even they claim you have to pay taxes to get to your savings abroad. If you still have assets and a bank account it's another storyee, proving to them you still have ties with your citizen ship country and being able to also block these assets.
 
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#12
Mike Forman said:
Tax certificate is only one document of the many documents you will need to provide to tax authorities that challenge your residence, it's not conclusive.

You will need to provide rental contract, gym subscription, daily spending with your visa... So summarized they want to see you really lived there.

If you travel around keep all your flight tickets, hotel bookings, spending proof.. In this case it can become a bit more challenging if you don't have any fixed tax residence which your home country will request. If you don't pay taxes anywhere they can indeed claim you should pay taxes in your country of citizenship.

If you have no assets in your country of citizenship or EU if you are from EU you will be quite safe, it's not easy for them even they claim you have to pay taxes to get to your savings abroad. If you still have assets and a bank account it's another storyee, proving to them you still have ties with your citizen ship country and being able to also block these assets.
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If you get a tax certificate in Dubai, you have effectively paid your taxes in dubai. To get a tax certificate you don't even need to prove anything to the dubai tax authority, they have your biometric data every time you get in and out. And you need either to have a property or a long term rental contract, which is in their system. Once you have that and spend 90 days in a year they give you a tax certificate.
If you left your country of origin and have no relationship with it ( I mean, no wife, kids, company, or other type of interest ) the tax certificate from Dubai is all you need to be compliant as long as, as I said, trigger residency somewhere else. And in most european countries triggering residency means either spending more than 183 days in the country or having the principal place of interest in the country, which again means kids, wife or business. Although the fact that double taxation agreement exists, makes things even more difficult:
Let's say you own a bar in Ibiza and work there during the summer months, and during the winter months you move to Dubai and work as a software engineer for a Dubai company. How is your money taxed?You are technically tax resident of both countries, and ( but I am guessing here ) you should not pay spanish taxes on money you generated working in Dubai on which you actually already paid taxes, because the money is already generated in Dubai. Things would be different if you did six months in Dubai but kept the restaurant in Ibiza open the whole year, the Dubai tax certificate is worthless.
 
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#14
sriracha said:
Let’s say I move to Dubai, create my own LLC with associated bank accounts for the LLC and for myself.

Should I get bored of Dubai and leave, can I keep the LLC and the bank accounts? Maybe I have to go back from time to time?
Click to expand...

In general, it may be possible to keep an LLC and associated bank accounts in Dubai even if you no longer reside there. However, there may be certain requirements that you need to fulfill, such as maintaining a registered office and appointing a local sponsor or agent, depending on the specific regulations in Dubai.

It's also important to note that if you are no longer a resident of Dubai or the UAE, you may need to consider the tax implications of maintaining the LLC and bank accounts. Depending on your country of residence and the specific tax laws in Dubai and the UAE, you may need to report any income or gains earned through the LLC or bank accounts, and may be subject to tax in both jurisdictions.
 
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#15
Mike Forman said:
If you don't pay taxes anywhere they can indeed claim you should pay taxes in your country of citizenship.
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Read post #10:
humorousgrape said:
This is incorrect advice except maybe for US, Eritrea and very few countries.
Most countries don't tax you based on being born there as long as you don't have any connections to that country any more like living there etc.
Click to expand...
 
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#17
Mike Forman said:
"As long as you don't have any connections there anymore.."
is the key note, not citizenship country. Citizenship is nonetheless a prerequisite to be at risk, since non-citizenship countries don't care nor have much information about you as long as you don't reside there.
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The "key note" is to bring it into context ;)
 
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#19
karishi said:
If you spend 90 days and have a property or run a business, like having a freezone company, you should be able to get a tax certificate, which is what you would want, because, as long as you don't trigger residency rules anywhere and you have a tax certificate from Dubai, your money is clean and you can spend it anywhere, as you paid taxes in Dubai and you should not have paid taxes anywhere else.
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Only if your home country is on this list and has "UAE Nationals and residents" written, you're eligible for TRC: https://tax.gov.ae//DataFolder/Files/eservices/FTA 2021 TRC Eligibility.pdf
 
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#20
zzzzzz said:
Only if your home country is on this list and has "UAE Nationals and residents" written, you're eligible for TRC: https://tax.gov.ae//DataFolder/Files/eservices/FTA 2021 TRC Eligibility.pdf
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I heard from my lawyer that now you can get tax certificate for any country if you spend 90 days in Dubai and have long term rental agreement.
 
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