US–UAE Tax & Legal Considerations

An overview for US citizens and green-card holders living, working or investing in the United Arab Emirates.

1. UAE Personal Tax

The UAE does not levy personal income tax on salaries, wages, dividends, capital gains or rental income earned by individuals. There is no inheritance tax and no wealth tax at federal level.

2. UAE Corporate Tax (CT)

• Federal Decree-Law No. 47 of 2022 introduced a 9% corporate tax effective for financial years starting on or after 1 June 2023.
• 0% rate on taxable income up to AED 375,000.
• Qualifying Free Zone Persons may keep a 0% rate on qualifying income, subject to substance and de-minimis rules.
• VAT remains at 5% on most goods and services since 2018.

3. US Tax Still Follows You

• The US taxes citizens and green-card holders on worldwide income — moving to the UAE does not end your US filing obligation.
• Foreign Earned Income Exclusion (FEIE) — Section 911 can exclude up to roughly USD 126,500 (2024) of foreign-earned wages if you meet the bona-fide-residence or physical-presence test.
• FBAR (FinCEN Form 114) — required if your foreign accounts exceed USD 10,000 in aggregate at any point in the year.
• FATCA Form 8938 — additional reporting at higher thresholds.
• CFC / GILTI rules can attribute income from your UAE company back to your US 1040.

4. Tax Residency Certificates

UAE-resident individuals and entities can apply to the Federal Tax Authority for a Tax Residency Certificate (TRC). This is the key document for invoking treaty benefits with countries that have a Double Tax Agreement with the UAE. Note: the United States and the UAE do not have a comprehensive income-tax treaty, so US-source income is still taxed under US default rules.

5. Banking & FATCA

UAE banks are FATCA-reporting institutions. When opening accounts you will be asked for a W-9, your SSN/ITIN, and a beneficial-owner declaration. Refusing FATCA disclosure is the most common reason a US person is declined a UAE bank account.

6. Practical Action Items

• Confirm your UAE residency days before claiming FEIE.
• File FBAR and Form 8938 every year you cross the thresholds.
• Coordinate the UAE corporate tax registration with your US accountant — entity classification (disregarded vs. corporation) affects your US return.
• Keep dual records in USD and AED for capital gains tracking.