The double tax treaty signed between UAE and Egypt has the role of offsetting the taxes charged on investors in these countries. Previous to the implementation of this convention, there was a risk of overcharging the companies for their business income. Another effect of the double tax treaty is tax exemption or tax rate reduction for several types of revenues. Our law firm in Dubai is ready to assist you with consultancy regarding the double taxation treaty UAE – Egypt.
Tax reduction for beneficiaries of the convention UAE – Egypt
As a resident of one of the two countries, any company or individual is a beneficiary of the double tax treaty signed between the UAE and Egypt. According to the provisions of the convention, the income obtained from interests, royalties, dividends and capital gains is taxed at special reduced tax rates. The tax convention refers to several types of capital revenues including income from properties, salaries and pensions.
The tax convention prevents over taxation by providing several new methods of return. Such an example is the credit method through which a tax which was charged as well in the source country is going to be returned to the person in the resident country. The person has the right to ask for a credit from the resident state, amounting to the value of the tax. The credit money thus obtained can be entirely used for reinvestment. This method allows investors to be charged only once for the income tax, the corporation tax and the tax on real estate.
Apart from the legal services that our law firm in Dubai provides, you can as well rely on one of our Dubai lawyers for more information regarding taxation rules and opportunities provided by the tax convention between UAE and Egypt.
Advantages of the tax convention between UAE and Egypt
The provisions of the tax convention between UAE and Egypt are very advantageous for all investors in both countries. This is naturally creating a strong economic relationship between the two states and mutual confidence in future partnerships. Thus the economic climate becomes a friendly one inviting to increased cooperation.
Another important strong point that the tax convention between UAE and Egypt brings is the advantageous taxation condition for companies. Through the return methods that the treaty introduces, the convention aims at maintaining the balance between the income and expenses of the companies thus encouraging companies to extend their activities from their country of residence to other markets. This is also a way to reduce tax evasion and increase the safety and transparency in trading operations between UAE and Egypt.
If you intend to establish a company in Dubai, you should as well consider the special taxation rules which apply to the free zones of this city. These are designed to provide special economic conditions and taxation framework for foreign investment.
You are welcome to contact our attorneys in Dubai for tax consultancy and for further information regarding the double taxation treaty between Egypt and UAE.