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Double Tax Treaty UAE- Germany

Double Tax Treaty UAE- Germany

In 2010 new provisions were added to the double taxation treaty signed between United Arab Emirates (UAE) and Germany in 1996. Thus there have been adopted new provisions which allow several alternative methods to avoid over taxation. Our law firm in Dubai can offer you legal support regarding the taxation provisions which apply to your commercial activity. 

Main provisions of the tax convention between UAE and Germany

One of the main novelties of the 2010 amendments to the tax treaty between UAE and Germany was the introduction of the credit methods as an alternative for tax exemption. The resident state takes into consideration the amount payed by the taxpayer in the source state. The taxpayer has the right to receive a credit equivalent to the amount that he/she payed in the source state.

For example, a German investor in the UAE who has at least 10% ownership of a company becomes subject to taxation in the UAE. The credit method is an efficient way for German investors to counterbalance the taxes payed in the UAE by receiving a credit in Germany.

Apart from the provisions regarding income, the tax convention between UAE and Germany refers as well to the taxation of salaries, pensions, self-employment and other revenues. The taxation frameworks for transportation activities are also regulated by the treaty as well as the taxation of income from real estate. 

Those investors who open a company in Dubai, benefit from special regulations which function in the free zones of this city. Our attorneys in Dubai can give you complete information about the direct implications of the tax treaty on your company. 

Advantages of the tax convention between UAE and Germany

An important reason for the signing of the tax treaty between UAE and Germany is the discouragement of tax evasion. In the same time, the efficiency of the cross-border trade is significantly increased. 

Along with the transport agreement and the investment protection agreement, the double tax treaty UAE-Germany is one of the political moves which consolidate the economic relations between the two countries. 

We kindly invite you to contact our law firm in Dubai, for detailed explanations regarding the tax minimization opportunities provided by the UAE-Germany tax convention