¿Dónde reside usted?
Here's why this is the most formal:
* Reside is a more formal verb than "vivir".
* Usted is the formal "you" in Spanish.
Here are some other options that are less formal, but still polite:
* ¿En dónde vive usted?
* ¿Cuál es su domicilio?
The choice of which phrase to use depends on the context and the level of formality required.