Singapore VCC insights

Singapore vs Dubai for Indians: Outbound Rules, Treaty Position and Residence for a Promoter Family’s Office

By VCC Editorial Team · Published 9 November 2026

Short answer: For an Indian promoter family, the choice is decided mostly by Indian law. Each member’s Indian residence, the US$250,000 Liberalised Remittance Scheme limit and the overseas investment rules apply whichever hub is chosen. Dubai has no personal income tax. Singapore offers a residence-based treaty test and a regulated family office framework.

This article is general information only and is not legal, tax or investment advice. For matters needing legal advice, we work with a panel of experienced Singapore law firms.

Most writing on Singapore vs Dubai for Indians starts with the destination. For a promoter family that still owns an Indian operating group, the binding constraints are Indian: where each member is resident for Indian tax, how much each can send abroad under the Foreign Exchange Management Act, 1999 (FEMA), and how the relevant treaty treats Indian dividends, interest and share gains. This article starts from those rules and then compares the hubs where they differ. Sources were checked on 9 November 2026 with India’s Income Tax Department, the RBI, the Inland Revenue Authority of Singapore (IRAS), MAS and the UAE Federal Tax Authority (FTA).

Which family members stay Indian tax residents after a move?

Each member is tested separately under section 6 of the Income-tax Act, 2025. A promoter who keeps running the group from India will usually stay resident. A child who relocates can become non-resident if India days are managed and the deemed residence rule is dealt with.

Section 6(2) makes an individual resident after 182 days in India in a tax year (the twelve months from 1 April under section 3), or after 60 days if he or she spent 365 days in India over the four preceding tax years. Two relaxations matter. Under section 6(3), the 60-day limb does not apply to a citizen who leaves India for employment outside India. Section 6(4) also disapplies it for a citizen or person of Indian origin living outside India who visits, but section 6(5) reinstates it with 120 days in place of 60 where income other than from foreign sources exceeds fifteen lakh rupees.

Section 6(7) is where the hubs can differ. An Indian citizen is deemed resident if he or she is “not liable to tax in any other country or territory due to his domicile, residence, or similar criteria” and has total income, other than income from foreign sources, above fifteen lakh rupees. Section 6(13)(c) then treats that person as not ordinarily resident (NOR). Under section 5(1)(c), an NOR’s foreign income is taxed in India only if derived from a business controlled in, or a profession set up in, India. Because the UAE “does not levy income tax on individuals” (UAE Government portal), a member moving to Dubai should take Indian advice on whether UAE tax residence shows liability to tax there. Singapore taxes resident individuals, so the point is less acute, but it should still be checked.

Section 6(10) also makes a company resident in India if its place of effective management (POEM) is in India, where key management and commercial decisions are “in substance, made”. A Singapore or Dubai holding company run from Mumbai can become Indian resident.

How much can resident family members move out under LRS and the overseas investment rules?

Each resident individual can remit up to US$250,000 per financial year under the LRS, and the form of any overseas investment is restricted. The limits are identical for Singapore and Dubai.

The RBI’s Master Direction on the Liberalised Remittance Scheme (updated 6 September 2024) allows remittances “up to USD 2,50,000 per Financial Year (April-March) for any permitted current or capital account transaction”. It states that the scheme “is not available to corporates, partnership firms, HUF, Trusts, etc.” Family members cannot pool their limits for capital account transactions unless they are co-owners of the investment. Received, realised or unused foreign exchange must be repatriated within 180 days unless reinvested.

Overseas direct investment (ODI) and overseas portfolio investment (OPI) are governed by the Foreign Exchange Management (Overseas Investment) Rules, Regulations and Directions, 2022. The RBI’s Overseas Investment Directions refer to the restriction that a resident individual may make ODI only in an operating foreign entity, and not in a foreign entity engaged in financial services activity. That restriction is lifted only for investment in an International Financial Services Centre (IFSC) in India, which is the subject of our GIFT City vs Singapore comparison. Resident individuals may make OPI within the LRS limit, including in units of an overseas investment fund “duly regulated by the regulator for the financial sector in the host jurisdiction”. A resident individual also “shall not make financial commitment by way of debt”.

A family investment company owned directly by resident promoters may therefore be hard to fit within these rules in either hub. Funding from members who have become non-resident, or holdings that qualify as OPI, are points to settle with FEMA counsel before money moves.

How does the India-Singapore treaty compare with the India-UAE treaty?

Neither treaty shelters gains on Indian shares bought after March 2017. The UAE treaty has lower caps on dividends and interest; the Singapore treaty has the easier individual residence test.

The table uses the texts published by IRAS (the India-Singapore agreement with its 2016 protocol and Multilateral Instrument (MLI) annex) and by the Income Tax Department of India (the India-UAE agreement, Notification GSR 710(E) of 18 November 1993 as amended in 2007 and 2013).

Point	India-Singapore	India-UAE
Treaty residence of an individual	Resident under the taxation laws of that State (Article 4(1))	UAE: present at least 183 days in the calendar year (Article 4(1)(b))
Treaty residence of a company	Resident under that State’s law; dual residence resolved by place of effective management (Article 4(3))	UAE: incorporated in the UAE and “managed and controlled wholly in UAE” (Article 4(1)(b))
Indian dividends: cap on Indian tax	10% if the beneficial owner is a company owning at least 25%; 15% otherwise (Article 10(2))	10% (Article 10(2))
Indian interest: cap on Indian tax	10% on bank or similar loans; 15% otherwise (Article 11(2))	5% on bank or similar loans; 12.5% otherwise (Article 11(2))
Gains on shares of an Indian company	Acquired before 1 April 2017: taxable only in the seller’s State (Article 13(4A)), subject to Article 24A. Acquired on or after that date: India may tax (Article 13(4B))	India may tax (Article 13(4)); shares deriving value principally from Indian immovable property also taxable in India (Article 13(3))
Anti-abuse	Article 24A shell or conduit test (annual expenditure below S$200,000 in Singapore); Article 28A preserves domestic anti-avoidance law; MLI principal purpose test (Article 29A)	Article 29 limitation of benefits: no benefit where obtaining it was “the main purpose or one of the main purposes” of creating the entity

Two points are easily missed. Article 24 of the India-Singapore treaty limits some relief to the amount remitted to or received in Singapore where Singapore taxes that income on a remittance basis; confirm its effect before relying on a reduced rate. And Article 6 of the UAE’s Cabinet Decision No. 85 of 2022 states that where an international agreement sets its own residence conditions, those conditions apply for that agreement. A member who qualifies under the UAE’s domestic 90-day route may still fail the 183-day treaty test. The wider network is covered in our Singapore tax treaty network article. The India-Mauritius position after the 2024 protocol is set out separately in our protocol note.

What does tax residence in Dubai require of a family member?

Domestic residence can be reached by a 183-day test, a 90-day test for permit holders or a centre-of-interests test, with no personal income tax and long-term Golden visas for investors.

Cabinet Decision No. 85 of 2022 (issued 2 September 2022, effective 1 March 2023) treats a natural person as UAE tax resident if the usual or primary place of residence and centre of financial and personal interests are in the UAE; after 183 days’ presence within 12 consecutive months; or after 90 days for a UAE or Gulf Cooperation Council national or residence permit holder who also has a permanent place of residence or employment or business in the UAE. Article 5 allows a resident to apply to the FTA for a Tax Residency Certificate.

The UAE Government portal lists investors among those eligible for the Golden visa, a renewable residence visa valid for five or ten years. Holders need no sponsor and may sponsor family members; the investor category lists a minimum capital of AED 2 million. A Dubai holding or investment company is within UAE corporate tax, charged at 0% on taxable income up to AED 375,000 and 9% above it under Federal Decree-Law No. 47 of 2022. Our Singapore vs Dubai tax calculation works through these figures for an individual principal.

What does Singapore offer the family that Dubai does not?

Singapore offers a single regulatory route for a family office, treaty residence that follows domestic residence and an exemption for foreign-sourced income received by resident individuals. Against that, it taxes employment income.

A foreigner is generally Singapore tax resident after 183 days in Singapore in the preceding calendar year, with an IRAS concession for three-year stays. IRAS states that foreign-sourced income received in Singapore by resident individuals is exempt, except where it is received through a Singapore partnership. Indian tax withheld under the treaty remains a cost.

For the office itself, MAS’s media release of 12 June 2026 confirms that the revised SFO framework took effect on 15 June 2026. It gives “a straight through class exemption from licensing for all qualifying SFOs”. SFOs that meet the requirements “need only notify MAS of their operations, and maintain an account with a MAS-licensed bank”, and they file an annual return. Existing SFOs have until 15 June 2027 to comply. Fund vehicles may seek the Section 13O or 13U incentives under the Income Tax Act 1947. Residence for principals runs through the Global Investor Programme (GIP), explained in our GIP guide, or an Employment Pass. Our sister site Singapore Employment Agency handles pass applications.

Singapore vs Dubai for Indians: how do the hubs compare side by side?

Dubai is cheaper on personal tax; Singapore is more predictable on treaty residence and regulation; the Indian rules treat both alike.

Question	Singapore	Dubai (UAE)
Indian residence and deemed residence (section 6)	Same Indian tests apply; Singapore taxes resident individuals	Same Indian tests apply; no UAE personal income tax, so the section 6(7) “liable to tax” point needs advice
LRS and overseas investment limits	US$250,000 per resident individual per financial year; ODI and OPI rules apply	Identical
Personal tax on the relocated member	Progressive resident rates on Singapore employment income; foreign-sourced income received is exempt	No income tax on individuals
Treaty residence of the individual	Resident under Singapore law	183 days in the calendar year
Cap on Indian dividends	10% or 15%	10%
Gains on post-2017 Indian shares	Taxable in India	Taxable in India
Family office regulation	MAS class exemption, notification, MAS-licensed bank account, annual return	Free zone or financial centre rules for family offices, which vary by zone
Long-term residence route	GIP or Employment Pass	Golden visa, five or ten years

How should a promoter family sequence the decision?

Settle residence and FEMA status first, then the vehicle, then the hub.

1. Map each family member’s India days for the current and next four tax years against section 6(2), the 120-day rule in section 6(5) and deemed residence under section 6(7).
2. Decide who stays in India to run the group, and assume any overseas company that person directs could have an Indian POEM.
3. Have FEMA counsel confirm each member’s FEMA status, LRS headroom and whether the intended holding is ODI or OPI.
4. Model Indian withholding on the expected dividend and interest flows under each treaty, and test the anti-abuse articles against the planned substance.
5. Choose the vehicle and regulatory route: an SFO under the MAS class exemption, or the relevant UAE free zone family office regime.
6. Line up residence (GIP or Employment Pass, or a UAE Golden visa or permit) and plan day counts against the 183-day treaty test.

Frequently asked questions

Can the promoter’s son become non-resident in India by moving to Dubai?

Yes, if his India days stay within section 6(2) and, where it applies, the 120-day rule. He should take advice on whether section 6(7) deemed residence can still apply; if it does, he is not ordinarily resident.

Does the India-UAE treaty exempt capital gains on Indian shares?

No. Article 13(4) allows India to tax gains on shares of a company resident in India. The India-Singapore treaty does the same for shares acquired on or after 1 April 2017.

Is a UAE Tax Residency Certificate enough for India-UAE treaty benefits?

Not by itself. For treaty purposes an individual must be present in the UAE for at least 183 days in the calendar year, and Article 6 of Cabinet Decision No. 85 of 2022 defers to the treaty’s own residence conditions.

Do the LRS limits stop applying once a family member leaves India?

The LRS is for resident individuals. A member who becomes a person resident outside India under FEMA falls under different rules, and FEMA residence is determined separately from tax residence.

Sources

• RBI Master Direction: Liberalised Remittance Scheme (updated 6 September 2024)
• RBI: Foreign Exchange Management (Overseas Investment) Directions, 2022
• IRAS: Singapore-India Avoidance of Double Taxation Agreement, with 2016 protocol and MLI annex
• UAE Cabinet Decision No. 85 of 2022 on tax residency (FTA unofficial translation)
• MAS: Revised Framework for Single Family Offices to take effect on 15 June 2026

Raffles Corporate Services helps family offices and fund managers with VCC incorporation, family office set-up and ongoing compliance, and works alongside Indian tax and FEMA counsel for promoter families comparing Singapore with Dubai. Email hello@rafflescorporateservices.com or Call/SMS/WhatsApp +65 8501 7133, or visit Raffles Corporate Services.

Last reviewed: 9 November 2026. The Editorial Team, Variable Capital Companies Act.