Is it really useful to empty accounts at the end of the year?

[lagloriacubana]

You sign the self certification form declaring you are a tax resident of what all‌ countries. If you declare just UAE - the residence permit is a proof of that‍ it very much might be possible you are doing correct declaration on certification form and⁠ bank takes you at your word. Unless, you have a high value account and there⁤ are indica that you might be resident in more than one country. SO yeah technically⁣ it is your responsibility to declare your tax residency.

Here is the complete guide by⁢ UAE Authorities on the subject:
https://mof.gov.ae/wp-content/uploa...tes-for-the-Common-Reporting-Standard-CRS.pdf

 

[Clank]

There is no difference between countries. UAE is not an exception.

It gets reported if‍ you have tax residency somewhere else in all CRS signer countries.

A completely different topic⁠ is if you are willing to lie to your bank.

 

[LegitBananas]

So basically you have︀ to either :

A) spend more than 183 days per year in the UAE or︁
B) Just declare you spend more than 183 days per year in the UAE, while︂ actually living somewhere else

perhaps its that simple, if the bank just takes you for︃ your word. Not really groundbreaking or unique though, I imagine people have tried this in︄ other countries too..

 

[PinkCat]

I'm wondering if⁣ you obtain that tax residency certificate from Dubai after spending just 3 months (there was⁢ some options to do that after just 3 months but don't remember the details, however︀ this certificate will most likely not be recognized by your home country) if that will︁ be enough to truthfully claim in front of your bank that you are Dubai tax︂ resident.

Btw few days ago I got an email from my Dubai bank to update︃ my tax residency information because there is 20k AED fine if it is not up︄ to date.....

edit: more info about the 90 days tax residency rule: https://www.lombardodier.com/conten...november/expats-in-the-uae-understanding.html

 

[CharlieHarper]

LegitBananas said:
So basically you have to either :

A) spend more than 183 days per year in the UAE or
B) Just declare you spend more than 183 days per year in the UAE, while actually living somewhere else

perhaps its that simple, if the bank just takes you for your word. Not really groundbreaking or unique though, I imagine people have tried this in other countries too..
Click to expand...

Because this is outside the Mentor Gold section, all I can say is that you need to research what is appropriate to your circumstances and follow the rules.

 

[lagloriacubana]

Because this is⁣ outside the Mentor Gold section, all I can say is that you need to research⁢ what is appropriate to your circumstances and follow the rules.

 

[Dh8]

Do you have an‌ actual source for this? If you read through the official CRS handbook, it's clear‍ that for bank accounts, only the total interest earned and the balance at year end⁠ is reported.

If the balance at year end is zero or even if you close⁤ the account, your account will still be reported to tax authorities, but the inflows and⁣ outflows are not automatically reported unless the inflow was interest earned from the bank itself.⁢

The idea behind emptying the balance before year end is that people hope that if︀ the balance at year end is zero or a low amount, it won't be material︁ enough for tax authorities to care.

Whether tax authorities still look into zero balances is︂ anyone's guess, but I'd wager they're more interested in someone with 1 million at year︃ end compared to someone with a zero balance.

 

[uplana]

It depends on a lot of factors, especially⁠ how well the tax authorities develop their systems. With AI, it should be a straightforward⁤ task to uncover all those "secret" zero-balance accounts.

 

[Dh8]

True, that's a scary thought. Imagine tax authorities don't⁠ develop their systems until years in the future.

You think you're safe with a zero⁤ balance every year but once their AI systems are implemented, what if they use it⁣ to look into all the previous years of zero balance accounts, now you're on the⁢ hook for years of unpaid taxes, interest and penalties.

 

[JackAlabama]

ai is no magic. It cant be⁣ with this amount of garbage data.

 

[Revoltec]

As long as it stays like it is now...

To be fair,‍ I do not understand why they haven't included the transaction data as reportable, it is⁠ stated on many bank statements already so it is not that hard to implement

 

[JackAlabama]

its again a case bc these are bureaucrats (which are all tax exempt at⁤ oecd / eu level btw), and dont really understand what they try to regulate.

 

[bubbledouble]

you mean they should report everything on the⁠ account, if so, they already do that in some banks in some countries.

 

[Revoltec]

For example?

 

[maxmoney]

Have personally seen this in Sweden and Norway,‌ have citizenship both places and Revolut reported me and the tax offices from both countries‍ send me some nice documents with all my transactions! Sweet right.

 

[Sols]

Do not rely on secrecy.

Do not rely on non-reporting "loopholes."

Do not rely on‌ banks doing only the minimum required under CRS/AEOI or FATCA.

Plan as if your bank‍ accounts are public knowledge to the relevant tax authorities.

Create circumstances for yourself whereby it⁠ doesn't matter whether the tax authority has all your bank statements, because you anyway pay⁤ an amount of tax (if any) that you are legally required to and comfortable with⁣ based on where you take up residence.

 

[bubbledouble]

I totally agree⁢ with you.

 

[wonderfulboy]

are you sure they are going so far if the accounts are empty ?

 

[Clank]

It's automatic.

 

[uplana]

As you can see from most of the replies here, you‍ definitely shouldn’t believe a bank or anyone else who claims they don’t report. I’m 99.9%⁠ sure they do.