If I am not wrong , You do no required any Tax certificate in this setup... just Need Utility bill and Passport ...
nobody asking Tax residency Certificate in this setup.......
Am I right ?
or I am making some mistake ?
If there is a foreign tax agency asking you for Tax residency certificate then you have bigger issues to worry about as your probably under investigation.
can anybody can confirm validity of this setup ?
Not sure who this setup is for. Is it against a challenge by your home country tax office? Most people once they de-register from their home country, cut ties and exit correctly their home country are not going to have any problems or bother with you.
100% - no one gets reported!
If this change it's the end as majority of clients we see don't intend to live full time in Dubai - couple of months yes but not the whole year.
Make the math and undertand the gap between written law and law enforcement and what's actually a Business from the GoV and not.
Unfortunately the UAE does not decide who gets reported and do not call the shots in this situation. They have to follow OECD rules and guidance on who gets reported otherwise they will be in violation of what they signed up to and will suffer much bigger consequences. The central bank fines on local banks have shown they are enforcing OECD CRS rules and addressing shortfalls and they will be forced to continue to do so for below reason. The fact they also changed tax residency rules for 2023 for what is considered tax resident also speaks of who is in control of events here.
The UAE is one of over a dozen countries listed by the OECD as having high risk CBI/RBI schemes that can be used to circumvent CRS. Hence their financial institutions are required under CRS to conduct extra due diligence whether they like it or not. Again failure to do so would not go well for UAE especially in current climate.
---- quote start
How can CBI/RBI schemes be misused to circumvent CRS reporting?
CBI/RBI schemes can be misused to undermine the CRS due diligence procedures. This may lead to inaccurate or incomplete reporting under the CRS, in particular when not all jurisdictions of tax residence are disclosed to the Financial Institution. Such a scenario could arise where an individual does not actually or not only reside in the CBI/RBI jurisdiction, but claims to be resident for tax purposes only in such jurisdiction and provides his Financial Institution with supporting documentation issued under the CBI/RBI scheme, for example a certificate of residence, ID card or passport.
What should Financial Institutions do?
Under Section VII of the CRS, a Financial Institution may not rely on a self-certification or Documentary Evidence if the Financial Institution knows or has reason to know, that the self-certification or Documentary Evidence is incorrect or unreliable. The same applies with respect to Pre-existing High-Value Accounts where a relationship manager has actual knowledge that the self-certification or Documentary Evidence is incorrect or unreliable.
In making the determination whether a Financial Institution has reason to know that a self-certification or Documentary Evidence is incorrect or unreliable, it should take into account all relevant information available to the Financial Institution, including the results of the
OECD's CBI/RBI risk analysis. As a result, where, taking into account all relevant information, the facts and circumstances would lead the Financial Institution to have doubts as to the tax residency(ies) of an Account Holder or Controlling Person, it should take appropriate measures to ascertain the tax residency(ies) of such persons.
To the extent that the doubt is related to the fact that the Account Holder or Controlling Person is claiming residence in a jurisdiction offering a potentially high-risk CBI/RBI scheme, FIs may consider raising further questions, including:
- Did you obtain residence rights under an CBI/RBI scheme?
- Do you hold residence rights in any other jurisdiction(s)?
- Have you spent more than 90 days in any other jurisdiction(s) during the previous year?
- In which jurisdiction(s) have you filed personal income tax returns during the previous year?
The responses to the above questions should assist Financial Institutions in ascertaining whether the provided self-certification or Documentary Evidence is incorrect or unreliable.
---- quote end