Private bank requesting tax residence certificate

[Sols]

No, it's‍ up to the bank to be able to prove to a regulator that they have⁠ taken all reasonable steps to understand where you are resident. If they can't prove that,⁤ the bank risks fines far exceeding the revenue they earn from you.

Maybe, but I'm glad it's︀ not me trying to take a bank to court over KYC. You might win such︁ a case, but the court would be likely to side with the bank and its︂ rights and obligations to obtain satisfactory proof that you are tax resident where you claim︃ to be.

Look at it from the bank's perspective. If a request for TRC or︄ equivalent is triggered, that's for a reason defined in the bank's policies and procedures. They︅ aren't going to back down until they have it. If the account holder starts refusing,︆ a simple routine check has turned into a suspicious activity. A genuine full-time resident in︇ Bahrain should have no problem obtaining a COR. A genuine tax resident in UAE should︈ have no problem obtaining a TRC. Their other clients resident in UAE and Bahrain are︉ able to produce those documents.

But it may never come to it. Your residence may︊ end up never being questioned.

 

[hortm]

What if one spends about 100 days / year in Bahrain and, therefore, can not get︇ COR and he did not spend more time at any other country. He has -︈ plane tickets, title deed, utility bills with usage, card statement... Don't you think it is︉ ok for bank's compliance/crs to proceed without COR?

 

[meze99]

Have you considered obtaining Monaco residence and banking there and in Switzerland if you think‌ UAE banks are not good/safe enough?
Also citizenship by investment maybe an option, but then‍ you are stuck with Caribbean banks

 

[Sols]

You're essentially just asking the same question over and over with slightly different wording. But the⁤ root is the same: you don't meet the normal standards of tax residence, so things⁣ will be complicated for you. Absent specific ruling (like Bahrain lacking personal tax residence rules),⁢ a prudent bank will look to the strictest international standards which are typically 183 days︀ of residence per year.

What it comes down to is that if a bank asks︁ for COR and you an't provide COR equivalent proof that you spend 183 days the︂ previous year in Bahrain, the bank will likely not accept your hotchpotch of documents. Bank︃ compliance departments need things that fit into their forms and procedures. You have to be︄ a very valuable, important client to the bank for them to bother going through your︅ travel itinerary and match that against tax residence rules of your destinations, to make sure︆ you (probably) didn't accidentally become tax resident somewhere else.

 

[Mike Forman]

This seems to be a never ending discussion and the questions asked can and will never⁣ have a one fit all answer. It is also a bit too simplified assuming that⁢ a bank needs to provide proof you don't reside in a country.

Each bank has︀ their own KYC and risk assement procedure, not because they want to but because they︁ are regulated and have to. Once something looks to risky beyond their appetite they have︂ the right t question you and ask any proof they deem necessary. Sometimes just showing︃ your residence card is sufficient, others want to see a utility bill and/or rental contract.︄

Banks don't need to prove anything and it's at their discretion to open or close︅ an account. Sure you can try to sue them, a legal battle for years you︆ will lose anyway.

Take one step back away and use some common sense. What is︇ the meaning of a resident? You reside in that country and have ties to this︈ country. Only a paper document and local TIN can suffice to open an account, but︉ as mentioned by others if your country of residence is known for offering residence documents︊ without the need of living there banks can and will question that. Dubai is on︋ the black list.

Just try to get your certificate, if you want to increase your︌ chances (and money) you can hire a lawyer who claims he can. Highlikely you won't︍ get and it and if you do it will be valid for 6 months. A︎ bank may request some new KYC proof and at that time perhaps you can't obtain️ this certificate.

Anyway I personally have never encountered any bank requesting such a document. A‌ residence proof (card, visa,..), utility bill and / or rental contract with a local TIN‍ number should be sufficient for a bank.

For claiming tax residence with tax authorities that⁠ want to challenge you, you will need to provide much more and show you actually⁤ lived there over 180 days

 

[hortm]

Thanks.

If it does not matter in terms of lifestyle where you think it is safer︇ to be tax resident (spend 90-100 days year) in UAE or Bahrain? (For UBO of︈ bank accounts in Switzerland, Cayman, Bahamas, US). Do I understand correctly that Bahrain is better︉ because UAE may fall from gray list to blacklist at FATF and then such UBO︊ may expect freezes at banks?

As for current black list with EU & Gray list︋ at FATF I am not concerned because it was same in about 2017 and those︌ banks accounts were totally fine with UBO's residence in UAE.

 

[Sols]

Safer in what sense? Safe from what exactly?

It's not⁤ clear whether Bahrain has avoided the same kind of gray listings as UAE because Bahrain⁣ is fundamentally better at AML/CFT compliance or if it's simply not been looked into yet⁢ due to being smaller and less important than UAE. You don't see Bahrain promoting itself︀ or being promoted the same way as UAE.

It depends on how you use the account. Gray lists of 2017︄ are different from gray lists of 2023. Expect things to be stricter this time. That︅ doesn't mean account closure or frozen funds, but rather more questions asked about transactions.

 

[hortm]

In term
Safer in terms of triggering unnecessary compliance or straightforward︁ account freeze (Passive NFFE entity in my case - almost no transfers. And no transfers︂ to UAE at all now).

 

[Sols]

All in all and looking at it long-term, no meaningful difference.⁠ UAE is more familiar but currently considered high risk due to the various gray lists.⁤ Bahrain is unfamiliar. This puts them on roughly equal grounds.

 

[jafo]

Did you ever solve this? Any updates?

 

[hortm]

seems Bahrain is‌ ok. just procedures are not streamlined.

 

[bonox]

Well Switzerland, Germany, Gibraltar banks all ask for the tax resident certificate if you are‌ a non EU citizen.

 

[hortm]

Switzerland is not asking for sure.‍

 

[uranium]

Anyone else can confirm‌ this ?

 

[hortm]

clarification.
maybe retail banks‌ do. private - don't.

 

[liroyb]

I don’t need TRC for deregistration from prior domicile, just for banks - Does UAE's‌ domestic TRC will satisfy European banks? Or they will insist on treaty TRC? (How different‍ is the certificate in terms of context?)

 

[JackAlabama]

so far so⁠ good, but you will be asked for dna and blood sample eventually and the digital⁤ id with your co2 allotment.