A Polish citizen who moves to the United Arab Emirates (UAE) for work with the intention of permanent residence is taxed in Poland only on income earned within Polish territory. This applies even if they cannot confirm their UAE address with a local residency certificate. This precedent-setting interpretation was obtained from the Director of the National Tax Information (KIS) by the Skarbiec Law Firm in Warsaw. The taxpayer was represented before DKIS by their attorney, tax advisor Hanna Jankowska-Kwiatkowska.
“Problematic” UAE Citizenship
Why is this tax ruling (specifically, an individual tax interpretation) by the Director of KIS so significant? It concerns the specific rules for confirming residency for tax purposes in the UAE. This destination attracts entrepreneurs, investors, influencers, artists, and workers from around the world with its low taxes and liberal economic system. This also applies to Poles, even though obtaining UAE citizenship is practically impossible. Without UAE citizenship, Poles cannot acquire tax residency certification under the double taxation agreement between the two countries, which was recently updated.
As noted by the Director of the Tax Chamber in Katowice in a prior interpretation, UAE citizenship is granted only to people of Arab descent born in the UAE, representing just 20% of the population. The rest are foreigners who cannot obtain UAE citizenship, regardless of how long they live and work there (case IBPBII/1/415-908/14/ASz, February 4, 2015).
Change in Regulations
Until April 30, 2014, Article 4(1) of the double taxation agreement (DTA) between Poland and the UAE defined a resident of a contracting state as someone who, under that state’s law, is subject to taxation due to their place of residence, domicile, management headquarters, or similar criteria. As of May 1, 2015, the provision was amended, stating that only UAE citizens residing in the UAE qualify as residents for tax purposes.
The Double Taxation Agreement
This change created uncertainty for Polish citizens who move to the UAE regarding their tax obligations to Polish authorities. Since foreigners, including Poles, cannot obtain UAE citizenship, they cannot rely on the Poland-UAE DTA to establish the UAE as their tax residence.
Loss of Polish Tax Residency
“We decided to approach it differently,” explains attorney Robert Nogacki from Skarbiec Law Firm. “We asked the tax authority whether, given the practical impossibility of obtaining UAE citizenship, our client — a Polish individual who has lived and worked in Abu Dhabi since February 2024 under a two-year work contract — has effectively moved their center of life interests to the UAE and therefore lost Polish tax residency.”
Legal Argumentation
According to Article 3(2a) of the Personal Income Tax Act, a person who does not have a place of residence in Poland is taxed only on income earned in Poland. Article 3(1a) defines a Polish tax resident as someone who either has their personal or economic center of interests in Poland or stays in Poland for more than 183 days in a tax year. The use of “or” means that meeting just one of these conditions qualifies a taxpayer as subject to unlimited tax liability in Poland. Not meeting either condition excludes them from this obligation.
“Our client moved to the UAE, signed a work contract there, and plans to return to Poland a maximum of five times per year, each time for no more than a week. Therefore, they will not exceed 183 days in Poland annually. They own no property in Poland. Although they cannot obtain a UAE tax residency certificate, they possess a UAE Resident Identity Card (equivalent to a Polish ID) and other documents, including a ZAP-3 form with a UAE address.”
Open Evidence for Confirming Residency
The tax authority agreed with the legal arguments. In an interpretation issued on September 17, 2024, the Director of KIS confirmed that Polish tax law places the burden of proving tax residency on the taxpayer. There is no closed list of acceptable evidence. According to Article 180 §1 of the Tax Ordinance, any evidence that can help clarify the case and is not illegal should be considered. The Director acknowledged that evidence of residency, besides or instead of a foreign tax residency certificate, could include:
- Foreign tax returns
- Foreign registration confirmations
- Employment contracts
- Rental agreements
- ZAP-3 forms with a new address
- Utility payment records
- Vehicle registration and insurance documents
Conclusion
What does this interpretation mean for Poles living in the UAE who have relocated their interests and lives to Abu Dhabi or other emirates? “Thanks to this interpretation, our client can finally rest easy,” says attorney Nogacki. “They will pay taxes only where they earn income, primarily in the UAE. They will pay taxes in Poland solely on income earned in Poland.”
This is good news for Poles in similar situations. However, a tax interpretation issued for one person typically does not protect other taxpayers. To receive similar protection, individuals must obtain their own ruling from the Director of KIS.
Alternatively, taxpayers can refer to the so-called dominant position of the KIS. The Tax Ordinance stipulates that a consistent interpretation practice exists if identical rulings were issued for similar situations within the relevant tax period and the preceding 12 months.
Author: Skarbiec Law Firm, specializing in legal, tax, and strategic advice for entrepreneurs
Source: Manager Plus – Precedent-Setting Tax Interpretation for Poles Living in the UAE
