Permanent Home and Center of Economic Interests Test

Structure of the Test

Article 4(1) of Cabinet Decision No. 85 of 2022 treats as a UAE tax resident any individual whose usual or primary place of residence is in the UAE and who has established the centre of his or her financial and personal interests there. These two elements are cumulative and rest on a thorough factual analysis, detailed by Ministerial Decision No. 27 of 2023 (Article 2).

The Permanent Home

The usual or primary place of residence is the jurisdiction where the person spends most of their time as part of their settled routine (Ministerial Decision No. 27 of 2023, Article 2(1) and (2)). In practice, it presupposes a residence continuously available to the taxpayer, suitable for use as the principal home of the taxpayer and his or her family, whether owned outright or held under a long-term lease. Continuity of availability is the key element: a residence that is regularly occupied over time, equipped for ordinary residential use, with a postal address and subscriptions to standard utilities (DEWA, Etisalat / du, internet).

Conversely, the following do not constitute a permanent home: a hotel room, even on an extended stay; an Airbnb, even for several months; a residence that is owned but leased to a third party (and therefore unavailable); or a residence that is owned but left vacant and never occupied.

The Centre of Financial and Personal Interests

The centre of financial and personal interests — close to the "centre of vital interests" of Article 4(2) of the OECD Model and to the "centre of economic interests" of Article 4 B, 1(c) of the French Tax Code — is assessed by reference to the place of occupation, familial and social relations, cultural activities, place of business and place from which the person's property is administered (Ministerial Decision No. 27 of 2023, Article 2(3) and (4)). It refers to the place where the individual:

• carries on his or her principal professional activity (corporate office, employment, self-employed profession);
• earns the bulk of his or her income;
• holds his or her principal investments;
• administers his or her assets and financial wealth.

The analysis is comprehensive and fact-based: no single element is determinative on its own, but the overall picture must clearly point to the UAE. An executive who receives a UAE salary into a UAE account, who invests savings through a UAE broker, who actually runs his or her UAE company, and whose principal real estate holdings are located in the UAE, presents a strong body of evidence.

Supporting Documentation

Practical Difficulty

The test is powerful but demanding. It is particularly well suited to executives who have transferred their entire professional activity to the UAE, who actually live in the territory with their family, and who have repatriated the bulk of their wealth. For more mixed profiles (entrepreneurs retaining activities in France or Europe, multi-jurisdictional family offices), the 183-day or 90-day tests often offer a more straightforward path.

Summary

The permanent home and center of economic interests test is the most demanding in terms of building the file, but also the most robust in terms of defense against France. It is well suited to stable, long-term situations where the relocation is complete and durable.