What are the benefits for foreign investors as per such double taxation agreements?
Under these treaties profits derived from shares, dividends, interest, royalties and fees are taxable only in the contracting state where the income is earned. Although corporate income tax is not levied in the UAE the provisions of the treaties do not state that such income must be taxed to qualify for benefits. Thus dividend income paid by a UAE company to a company which has a double taxation agreement with the UAE may not be taxable in the hands of the foreign parent company even though it has not been taxed in the UAE. However, many countries have anti-avoidance provisions which either set minimum levels of tax for income to benefit from tax treaties, or set out lists of low-tax countries which do not qualify under tax treaties. Therefore it is necessary to study the tax legislation of each treaty partner as well as the text of the treaties themselves before assuming anything about the tax treatment of untaxed income flows originating in the UAE. Most of the double taxation agreem
