You Live in Dubai, but Poland Still Takes Its Cut
A Polish entrepreneur moves to Dubai. He lives there, works there, pays his bills there. The Emirates charge him no personal income tax—but they consider him their tax resident. Poland, too, acknowledges that his tax residency has shifted: he has lost Polish residency, and Warsaw can, at most, assert a claim to exit tax. In theory, he should enjoy reduced withholding-tax rates on his Polish-source income under the bilateral treaty. In practice, he cannot—because he is unable to produce a UAE tax-residency certificate that satisfies the treaty’s definition. And without that document, Polish withholding tax is collected at the full domestic rate.
The Certificate: Why It Matters and Why Dubai Doesn’t Issue One the Way Poland Expects
A certificate of tax residency is a document issued by the tax authority of a given country confirming that a specified person is a tax resident of that country. In Polish law, Article 5a(21) of the PIT Act defines it as “a certificate of the taxpayer’s place of residence for tax purposes issued by the competent tax-administration authority of the taxpayer’s country of residence.”
The document serves an operational function—it is the condition under which a Polish payer may apply a reduced withholding-tax rate or an exemption provided by a double-taxation treaty. Without it, a Polish entity remitting payments abroad is obligated to withhold at the full domestic rate.
The problem with the Emirates is structural. For decades, the UAE levied no personal income tax—which meant there was no system under which certificates of tax residency, in the sense that Polish authorities expect, were issued. Even after the introduction, in 2023, of a federal corporate income tax at nine per cent, natural persons remain outside the scope of UAE income taxation. An Emirates Resident ID, a residence visa, even a so-called Tax Residency Certificate issued by the Federal Tax Authority for treaty purposes—none of these documents changes the fact that, under the bilateral Poland-UAE treaty, a natural person without Emirati citizenship is not a “resident” within the meaning of Article 4(1).
It is worth pausing to note just how peculiar this clause is. The citizenship requirement is virtually unheard of in international tax-treaty practice. There is almost no expert literature explaining why it was introduced, and it departs sharply from the OECD Model Convention standard that underpins the vast majority of bilateral agreements worldwide. For some time, it appears, practitioners on both sides paid it little attention. That has changed in recent years. Today, a Polish national residing in the Emirates simply cannot obtain a certificate of tax residency that is usable under the Poland-UAE treaty.
Withholding Tax: The Concrete Sums You Lose
The consequences of the inability to invoke the treaty are measurable and affect several categories of income that a Pole living in Dubai may continue to earn from Polish sources.
The numbers are concrete.
Dividends from Polish Companies
The domestic withholding rate on dividends paid to non-residents is nineteen per cent. The treaty rate under Article 11 of the Poland-UAE agreement is five per cent (where the recipient holds at least ten per cent of the capital) or fifteen per cent otherwise. Without the certificate, the company withholds at nineteen. On a dividend of five hundred thousand złoty—roughly a hundred and twenty-five thousand dollars—the difference between the five-per-cent treaty rate and the nineteen-per-cent domestic rate is seventy thousand złoty per year.
Interest on Loans to Polish Entities
Domestic rate: twenty per cent. Treaty rate under Article 12: five per cent. On annual interest of two hundred thousand złoty, the gap is thirty thousand złoty.
Royalties
Domestic rate: twenty per cent. Treaty rate under Article 13: five per cent. On annual royalties of three hundred thousand złoty: forty-five thousand złoty lost to the higher rate.
Fees for Intangible Services
Article 29(1)(5) of the PIT Act imposes a twenty-per-cent withholding tax on income from advisory, accounting, market-research, legal, advertising, and management services paid to non-residents. A Pole running a consultancy from Dubai for Polish clients, without a certificate, faces the full rate.
The Payer Cannot Look the Other Way
This is not a matter of goodwill. Polish law imposes on the payer—the company disbursing the dividend or the interest—a duty of “due diligence” in verifying the conditions for applying a reduced rate. The absence of a tax-residency certificate precludes satisfaction of that duty. A payer who applies the treaty rate without holding the certificate assumes tax liability, including default interest.
Even a sympathetic board of directors cannot legally reduce the withholding. The barrier is structural, not discretionary.
The Double Gap in Protection
The situation of a Pole in Dubai without Emirati citizenship creates a paradox that deserves to be fully understood.
At the level of residency: if he has lost his center of interests in Poland, he is no longer subject to unlimited tax liability there on worldwide income. The UAE, for its part, considers him a resident for purposes of its own domestic tax framework. But the Emirates will not issue him a certificate of tax residency for purposes of the double-taxation agreement with Poland.
At the level of withholding tax: even if he has effectively relocated his center of vital interests and Polish authorities recognize him as a non-resident, he still cannot invoke the reduced treaty rates—because the citizenship requirement blocks the application of the treaty altogether.
Three Paths to Minimizing the Damage
1. Ownership Restructuring Through a Treaty Jurisdiction
If the primary concern is dividend withholding, it may be worth considering whether the ownership structure should run through an entity in a jurisdiction that maintains a favorable tax treaty with Poland—one with a standard OECD-model definition of resident, without a citizenship requirement. A holding company in an EU or EEA country may benefit from the dividend exemption under the Parent-Subsidiary Directive or a bilateral agreement. This demands genuine economic substance; artificial structures invite challenge under the Principal Purpose Test of the MLI and Poland’s domestic General Anti-Avoidance Rule. Questions of beneficial ownership of the dividends must also be taken into account.
2. Tax Residency in a Third Country
Rather than a direct Poland-to-UAE move, the taxpayer establishes residency in a jurisdiction connected to Poland by a standard treaty. This achieves not only the loss of Polish residency (which Dubai alone can accomplish) but also provides the certificate needed to apply reduced withholding rates on Polish passive income. The individual may then reside physically in the UAE while maintaining formal residency in the third country. This path, however, creates an enormously complex web of interpretive possibilities regarding the taxpayer’s status among three jurisdictions—Poland, the UAE, and the third country—where the domestic laws of all three states must be considered alongside the international agreements that bind them: the treaty between Poland and the third country, and the treaty (if any) between the third country and the UAE.
3. Elimination of Polish Passive-Income Sources
The radical option: sell the shares in Polish companies, collect the loans, terminate the licensing agreements. If there is no Polish income subject to withholding, the absence of a UAE certificate ceases to matter. This makes sense only where UAE-sourced income is substantial enough to justify the liquidation of Polish assets.
CRS and Reporting Obligations
Even after losing Polish residency, obligations under the Common Reporting Standard persist. Polish financial institutions—banks, brokerage houses, investment funds—report information on non-resident accounts. Declaring the UAE as the country of residence triggers information exchange with the Emirates, but it provides no “protection”—and Polish authorities may use the reported data to challenge the declared residency.
A non-resident earning income on Polish territory also remains obligated to file a Polish tax return (PIT-36 with the PIT/ZG annex) covering that income.
The Essential Takeaway
A move to Dubai is an effective tool for losing Polish tax residency—provided the relocation of the center of vital interests is genuine. This mechanism operates under Polish domestic law and requires neither a UAE tax-residency certificate, nor treaty protection, nor Emirati citizenship.
The certificate problem surfaces on a different plane entirely—withholding tax on Polish-source income. There, the inability to invoke treaty rates generates real costs amounting to tens of thousands of złoty per year. Solutions exist, from ownership restructuring through third-country residency to the liquidation of Polish assets, but each demands individualized analysis in light of substance requirements and anti-avoidance risks.
Planning a move to the Emirates should therefore encompass not only the conditions for losing Polish residency but also a strategy for managing Polish passive income after that residency is gone.
Robert Nogacki is a licensed legal counsel (radca prawny) and managing partner of Kancelaria Prawna Skarbiec, a Polish law firm specializing in legal, tax, and strategic advisory services for businesses.
