One of the biggest questions we hear from European clients looking to relocate or invest in the UAE is this: “What happens to my tax situation back home?”

The UAE has one of the largest networks of double tax treaties (DTTs) in the world — and if used properly, they can help residents and business owners reduce or eliminate double taxation. But it’s important to understand how they actually work.

Here’s a practical, no-jargon guide to double tax treaties in the UAE — and how you might benefit if you’re a European with international income or assets.

What is a double tax treaty?

A double tax treaty is a formal agreement between two countries designed to prevent the same income from being taxed twice — once in the country where it’s earned, and again in the country where you live (or are considered a tax resident).

In theory, DTTs are about fairness. In practice, they’re also a powerful tool for global structuring — if your residency and business structures are aligned.

The UAE’s DTT network (as of 2025)

The UAE has signed over 140 double tax treaties, covering most major European economies, including:

  • Austria
  • Belgium
  • Cyprus
  • Estonia
  • Finland
  • Greece
  • United Kingdom
  • France
  • Italy
  • The Netherlands
  • Switzerland
  • Lithuania
  • Latvia
  • Luxembourg
  • Portugal
  • Poland
  • Spain
  • Ireland

(German clients: As of 2025, Germany and the UAE are still negotiating a renewal of their agreement that expired in 2021.)

These treaties apply to individuals, companies, and sometimes specific types of income like dividends, royalties, or pensions.

Unlike tax havens with no substance, the UAE is a recognised and respected jurisdiction in international tax planning — and these treaties are a key part of that reputation.

How double tax treaties work in practice

Let’s say you’re a Swiss entrepreneur who moves to Dubai and sets up a company. You still receive dividends from a business back in Switzerland.

Without a DTT, those dividends could be taxed in Switzerland and potentially again in your new country of residence. But with the UAE-Swiss treaty in place, Switzerland may withhold less tax at source — and the UAE, which doesn’t tax personal income, won’t add anything on top. You’ve avoided double taxation.

Or perhaps you’re a UK national who’s moved to Dubai and become a UAE tax resident. You receive royalty payments from a UK licensee (through a UK holding company). Under UK tax rules, royalties are subject to 20% withholding, but the UK-UAE treaty reduces this to 0% (provided the treaty conditions are met). The UAE doesn’t tax your personal income, so there’s no second layer – double taxation avoided.

So, suppose you have a rental property in London. In that case, the UAE-UK DTT means that your rental income will be taxed in the UK (where the property is located) and not in the UAE – again avoiding double taxation.

Each DTT is slightly different — some lower withholding taxes on dividends, some offer full exemptions, and others allow for foreign tax credits. The key is knowing which country has taxing rights on what income, and what conditions you need to meet to benefit.

Common benefits of the UAE’s DTTs

  • Reduced or zero withholding tax on cross-border payments (e.g., dividends, royalties, interest)
  • Clarity on tax residency, which is especially helpful if you live in more than one country
  • Elimination of double taxation on salaries, pensions, or property income
  • Business-friendly treatment of profits earned across borders
  • Greater legal certainty when investing or operating globally

A word on substance and residency

Here’s where many people go wrong: just having a UAE visa isn’t enough to rely on a DTT.

  • To access treaty benefits, you must usually be considered a tax resident of the UAE. That means:
  • Holding a valid UAE residency visa
  • Living in the UAE for a meaningful portion of the year (at least 183 days)
  • Having proof of economic and residential ties (e.g., lease agreement, utility bills)
  • Applying for a Tax Residency Certificate (TRC) through the UAE’s Federal Tax Authority

Without this, your home country may still consider you a tax resident under its own rules, and treaty protection may not apply.

In short: you need substance, not just structure.

Why it matters for Europeans in the UAE

Europeans, especially from high-tax jurisdictions like Germany, France, Italy, or the UK, stand to benefit the most — but they also face more scrutiny.

If you’re managing international income, cross-border investments, or planning for succession, DTTs can:

  • Lower your tax exposure on passive income
  • Help avoid mismatches between countries’ tax rules
  • Support clean, compliant, and defensible tax positions
  • Enable international business operations from a UAE base

But don’t try to DIY it. Missteps around tax residency or treaty misuse can be costly and trigger audits or penalties back home.

How Servefast Advisory can help

At Servefast Advisory, we work with individuals, entrepreneurs, and families to structure their global affairs in a way that’s clear, legal, and effective. Whether you’re applying for a Tax Residency Certificate, setting up a UAE company, or planning to manage income across borders, we’ll help you make sense of the rules — and make them work for you.

Interested in using the UAE’s double tax treaties to your advantage? Let’s talk.