UAE & Singapore – Double Taxation Agreement Policies & Tax Rates

Overview

In general tax regulations in Singapore are progressive and the rates are decided based on the income and the business profits and returns. The UAE-Singapore Double Tax Agreement ensures Singaporeans with businesses or income in the UAE don’t pay taxes in both countries. Singapore and the United Arab Emirates signed a DTA in 1989, which came into effect in 1991. The aim is to provide mutual tax exemptions on business and air transport income generated in Singapore and the UAE. It applies to both companies and residents of the two countries and covers income tax in both jurisdictions.

Double Taxation Agreement – Tax implications – Singapore & UAE

The DTA signed between UAE & Singapore is slightly different from that of UAE & other countries. They have a concept of ‘Operations of Aircraft’ which includes both the public and private sector companies. Article 3 of the treaty states that income and profits from operating aircraft in international traffic or movable property are exempt from taxation in the other country. Additionally, UAE and Singapore companies earning profits from selling aircraft or related equipment are also exempt from taxation in the other countries. The treaty further specifies that if one country taxes a company covered by the agreement, the tax will be refunded upon applying to the relevant authority within six months.

Taxes Covered – Double Taxation Agreement Between UAE & Singapore

The treaty specifies that dividends, interest, and royalties can be taxed in either Singapore or the UAE, while employment income is taxed in the country where the work is performed. It also covers taxes on pensions and government services. For detailed information about the Singapore-UAE double taxation agreement, you can reach out to our experts at Arnifi for legal advice and documentation. The tax rates depend on the amount of profit an individual gets from these sources while ranging between 0% to 24% approximately.

Arnifi – See How Our Experts Handling Tax Compliance & Services

Setting up a business or company in a country other than the parent company’s location is a significant task that goes beyond just the entrepreneurial side. As you move forward with the process, understanding taxation is crucial to avoid penalties and comply with the laws of both the parent and the host countries. Since Double Taxation Agreements vary from country to country, especially when dealing with the UAE, consult our experts at Arnifi for clear guidance and ongoing support on all aspects of your business. This way, you can focus on building and growing your business.

Also Read – Double Taxation Agreement Between UAE & Germany