UAE

Why UAE?

UAE is the global reference for high-income nomads: 0% personal income tax, no taxation on capital gains or dividends, and a Free Zone ecosystem (DMCC, IFZA, RAKEZ, ADGM) that lets freelancers and companies operate with near-zero friction. Since 2023 there's a 9% corporate tax on company profits above 375,000 AED (~€100,000), but the advantages are still huge vs any European country.

Tax regime

• Personal income tax: 0% (doesn't exist).
• Corporate Tax (introduced 2023): 9% on annual profits >375,000 AED (~$100K). Free Zone companies are exempt if they qualify as "Qualifying Free Zone Person" (don't bill UAE mainland).
• VAT: 5% on local sales.
• Dividends / capital gains / inheritance: 0%.

Residency paths

How to certify UAE tax residency (key for Spain)

UAE doesn't issue a tax certificate automatically. You need:

1. Active residence visa (any of the above).
2. Emirates ID + open local bank account (Emirates NBD, ADCB, FAB).
3. Minimum physical presence registered by Immigration (entry/exit fingerprints).
4. Tax Residency Certificate application to the Federal Tax Authority — typically requires ~90-180 days/year of presence for issuance without dispute.

Without that certificate, Hacienda doesn't automatically accept your residency change.

Spain-UAE treaty (2006)

The bilateral treaty covers:

• Residency rules (tie-breaker criteria): permanent home, center of vital interests, habitual abode.
• Taxation of employment income: where the activity is performed.
• Elimination of double taxation via exemption or tax credit.

Implications from Spain (low risk)

• Modelo 720 required if you keep Spanish assets >€50K.
• UAE Tax Residency Certificate breaks the Spanish residency presumption.
• Main risk: someone who keeps a Madrid apartment rented out, resident family and Spanish company, declaring UAE residency only on paper — won't survive an audit.
• High cost of living: Dubai 1BR downtown ~$3,000/month, ~$80 food/day. Only worth it with income >$150,000/year.