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Note: This Treaty may be impacted by the Multilateral Convention to Implement Tax Treaty Related Measures to Prevent BEPS (MLI). MLI impact on Tax Treaties is available with the Orbitax International Tax Research & Compliance Expert.

ARTICLE 4

Resident

(1) For the purposes of this Convention, the term “resident of a Contracting State” means:

  • (a) in the case of Israel, any person who, under the laws of Israel, is liable to tax therein by reason of his domicile, residence, place of management, place of incorporation or any other criterion of a similar nature.
  • (b) In the case of the United Arab Emirates:
    • (i) an individual who is present in the United Arab Emirates for a period or periods in the aggregate of 183 days or more in each of the tax year concerned and the previous tax year, provided that such individual can prove that he is a domicile of the United Arab Emirates and that his personal and economic relations are closer to the United Arab Emirates than to any other State;
    • (ii) a qualified government entity or a company which is incorporated in the United Arab Emirates, provided that such entity or company can prove that its place of effective management is in the United Arab Emirates, and that its capital is wholly beneficially owned by the United Arab Emirates or by a qualified government entity of the United Arab Emirates or a federal or local governments or by individuals being residents of the United Arab Emirates, and the company is controlled by the aforementioned residents.
  • (c) In the case of both Contracting States, the term "resident of a Contracting State" shall also include a Contracting State and any political subdivision or local government or local authority thereof, as well as a recognised pension fund of that Contracting State. This term, however, does not include any person who is liable to tax in that Contracting State in respect only of income from sources in that Contracting State.

(2) Where by reason of the provisions of paragraph (1) an individual is a resident of both Contracting States, then his status shall be determined as follows:

  • (a) he shall be deemed to be a resident only of the State in which his personal and economic relations are closer (centre of vital interests); if the State in which he has his centre of vital interests cannot be determined, he shall be deemed to be a resident only of the State in which he has a permanent home available to him;
  • (b) if he has a permanent home available to him in both States, or if he has not a permanent home available to him in either State, he shall be deemed to be a resident only of the State in which he has an habitual abode;
  • (c) if he has an habitual abode in both States or in neither of them, he shall be deemed to be a resident only of the State of which he is a national;
  • (d) if he is a national of both States or of neither of them, the competent authorities of the Contracting States shall settle the question by mutual agreement.

(3) Where by reason of the provisions of paragraph (1) a person other than an individual is a resident of both Contracting States, such person shall be deemed not to be a resident of either Contracting State for the purposes of the Convention, and shall not be entitled to any relief or exemption from tax provided by this Convention except to the extent and in such a manner as may be agreed upon by the competent authorities of the Contracting States.