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Indian tax and compliance, from the UAE

Dubai · Abu Dhabi · Sharjah · Ajman · Ras Al Khaimah

Roughly three and a half million Indians live in the UAE, and almost all of them keep something behind in India — a salary account, a flat, a share of a family business, a demat account that still has old holdings in it. None of that stops being taxable in India because you moved.

What makes the UAE different from most places we work with is that it charges no personal income tax. That sounds like it simplifies things. It does the opposite. Several provisions of Indian law turn specifically on whether you are liable to tax somewhere else, and for a UAE resident the answer is often no — which is how people who have not lived in India for years find themselves treated as Indian residents anyway.

The India–UAE treaty does most of the repair work, but only if it is claimed with the right documents, in the right year, on the right form. Claiming it late, or without a residency certificate, is the same as not claiming it.

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Two fields. We come back with what applies to your residency position and what it costs — and we work Indian hours, so allow for the time difference.

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Before anything else

Who holds which licence

Tax Station — India

Anything under the Income-tax Act, FEMA or the Companies Act. Your Indian return, treaty relief, remittance certificates, and an Indian company if you need one. Our work, our fee, published on each service page.

Our UAE partner

Forming a company in the UAE, registering for its taxes and signing a statutory audit are regulated there and require a local licence. We do not hold one, so that work is delivered by a licensed partner firm, and quoted by them.

We say this up front because it decides who is answerable if something goes wrong. One point of contact, two firms, and you should know which is which before you engage either.

Where it goes wrong

What catches people in the UAE

01

Deemed residency, written with the Gulf in mind

An Indian citizen whose Indian income crosses ₹15 lakh in a year, and who is not liable to tax in any other country, can be treated as a resident of India regardless of how few days they spent here. A UAE salary is not taxed anywhere. That is precisely the situation the provision describes, and it is the single most common shock for clients in Dubai and Abu Dhabi.

02

182 days quietly becomes 120

The familiar 182-day test drops to 120 days for an Indian citizen or person of Indian origin visiting India whose Indian income exceeds ₹15 lakh. People who come home for a long summer, a wedding season and a winter break add up past 120 without ever thinking of themselves as living in India.

03

Treaty relief claimed without a residency certificate

To take India–UAE treaty benefit you need a Tax Residency Certificate from the UAE authority, and Form 10F alongside it. Most people do not know the UAE issues one at all. Without it the claim is refused, and by the time the notice arrives the year is closed.

04

Property sale taxed at the wrong rate from the start

When an NRI sells Indian property, the buyer must deduct tax under section 195 — not the 1% that applies to resident sellers. The deduction is on the whole consideration, not the gain, so the cash locked up is far larger than the tax actually due. A lower-deduction certificate applied for before the sale fixes this. Applied for after, it does not.

05

Repatriation stopped at the bank counter

Money moving out of an NRO account runs against an annual limit and needs Form 15CA with a chartered accountant's 15CB certificate behind it. Banks will not release the transfer without them, and the certificate cannot be issued retrospectively for a transfer already attempted.

06

RNOR missed on the way back

Someone returning to India for good usually qualifies as Resident but Not Ordinarily Resident for two or three years, during which foreign income stays outside the Indian net. It is a window that has to be identified in the first return after moving. Filed as an ordinary resident, it is gone.

07

UAE corporate tax changed the structuring answer

Since June 2023 the UAE levies corporate tax on business profits. Structures built when the answer was zero — a UAE holding company over an Indian subsidiary, management fees routed through a free zone entity — now have to be tested on both sides, and related-party pricing has to hold up in India and in the UAE at the same time.

Before you act on this

Residency thresholds, treaty relief and remittance limits change, and the UAE corporate tax regime is still settling. Nothing here is advice on your facts — check the current position, or ask us, before you act on it.

Handled by us, in India

The India side

Fees are published on each page. Government charges, where they apply, are shown separately and billed at actuals.

Handled in the UAE, by a licensed partner firm

The UAE side

Introduced and coordinated by us, quoted and delivered by the licensed firm. No fees are listed here because they are not ours to publish.

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