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UAE Corporate Tax–Comply In Timely & Efficiently
In a couple of years, the UAE underwent crucial tax reforms in an effort to expand its state revenue sources, modernize its tax code, and bring it into compliance with worldwide best practices. According to the Ministry of Finance, federal corporation tax on UAE business profit will now be 9% with an AED 375,000 threshold.
June 1, 2023, marks the implementation of this new corporate tax reform in Dubai. UAE Corporate Tax is among the most competitive in the world and the lowest in the GCC. Since it is a federal tax the UAE corporate tax (CT) will be levied across all Emirates including Dubai, Abu Dhabi, Sharjah, and more. The Ministry of Finance (MoF) will be held responsible for administrating, collecting, and enforcing corporate tax in Dubai.
Avyanco is one of the trusted corporate service providers in UAE envisioned assisting you in complying with the UAE corporate tax laws, avoiding any hefty fines and penalties, and meeting your business’s goals seamlessly.
What Is Corporate Tax in UAE – Expert Assistance
Corporate Tax laws in Dubai will undergo a number of changes in 2023. To implement a new corporation tax (CT) system in the UAE, the UAE Ministry of Finance published Federal Decree-Law No. 47 of 2022 on December 9, 2022.
Starting with their first fiscal year that begins on or after June 1, 2023, all companies and businesses will be subject to UAE Corporate Tax. Corporate Tax (CT) is a direct tax levied on companies and businesses’ net income or profits.
UAE Corporate Tax: Scope
- Banking activities
- All companies and investors performing activities under a UAE trade license will be eligible for UAE corporate tax
- Foreign organizations and investors that conduct trade or commerce on a regular basis in the UAE are eligible for UAE CT
- Businesses involved in development, construction, real estate management, agency, and brokerage in UAE
UAE Corporate Tax: Exemptions
- Pension or social security funds
- Qualifying public benefit entities
- Qualifying investment fund Subject to regulatory oversight
- Charities and public benefit organizations
- Government and Government-controlled entities
- Interest and other income derived from bank deposits or savings plans by an individual
- Dividends received by a foreign investor within UAE will be fully exempt from corporate tax.
How to Prepare For Corporate Tax?
Before preparing for corporate tax law in UAE, make sure to assess whether or not you are applicable for it. It is always recommended to consult with an expert corporate tax service in Dubai who can assist you regarding the CT laws.
Avyanco is all and well capable of providing informed assistance to businesses in various industries to help them regulate their accounting and bookkeeping and comply with corporate reforms.
Understand the requirements for your business
- Whether and by when your company needs to register for Corporate Tax;
- What is the Accounting / Tax Period for your business;
- When your business would need to file a Corporate Tax return in Dubai;
- What applications your business may or should make for Corporate Tax purposes;
- What financial information and records your business will need to keep for Corporate Tax purposes?
Consult with an Experienced Corporate Tax Consultant
It is better to consult with an experienced corporate tax consultant in UAE who can help you understand further development incorporate tax rules, regulations, circulars, and notifications from the Ministry of Finance and the Federal Tax Authority. Avyanco will help you understand every aspect of the CT law and comply with it efficiently.
Corporate Tax Services in UAE to Excel Your Business
Timely planning for corporate tax compliance will help businesses save higher costs and relieve internal teams of the strain to finish these preparations by a short deadline. Avyanco keeps an in-depth knowledge and understanding of the latest corporate tax laws in Dubai. Our experience powered by expertise will ensure that your business will make a humble transition into the era of Corporate Tax. Comply with the tax rules in Dubai hiring the best corporate tax services in Dubai and growing seamlessly.
- Initial assessment of the anticipated impact of the introduction of CT and TP: (Transfer pricing) based on the group structure and solo entity
- Assess the decision related to Foreign Direct Investment (FDI) and cost-benefit analysis of pre-tax and post-tax return on FDI
Detailed analysis based on legislation
- Identify restructuring and optimization opportunities and required system changes by reviewing contracts with suppliers and customers
- Dividend distribution decisions on cross-border investments
- Merger and Acquisition decision due to huge loss incurred by one of the group companies
- Assist in implementing necessary changes to legal documents according to the requirement of Corporate Laws
- Designing TP policies, legal structure, operating model, capital structure, tax function, etc
- Continuous coordination with management to have the best possible outcomes of tax structuring
- Assist with CT registrations and applications for tax groups
- Preparation and submission of CT return, and TP documents
- Obtaining tax clarification and tax exemptions from tax authorities
- Appearing before the tax authorities to accomplish the tax assessment initiated by the Federal Tax Authorities
Benefits of Corporate Tax Consultants in Dubai
Choosing the best corporate tax services in Dubai is a win-win for small to medium to large-scale companies. We will help you remain aware of the taxation policies and latest reforms in the country. We make sure to deliver quality and real-time tax assistance to add value to your business
Why Choosing Avyanco Tax Consultants?
Boost business growth and accelerate financial success with our expert accounts and tax consultancy services in Dubai. Avyanco is a trusted tax consulting company in Dubai that aspired by its vision to assist businesses to adapt to modern changes and excel uninterruptedly.
- Our team is self-driven by the fundamental objective of enhancing the overall wealth of stakeholders.
- We analyze tax-cost management alternatives through applications of appropriate tax strategies to operate within legal boundaries.
- We have implemented total tax management strategies to reduce the overall tax burden on cross-border international transactions.
Why Choosing Avyanco Tax Consultants?
Avyanco is the leading corporate tax consultant in UAE committed to assisting businesses from small to large in examining and implementing corporate tax systems that are tailored to your company’s needs.
- Specialized in different jurisdictions
- Well-versed in the dynamic of the UAE corporate tax structure
- Brand value and business valuation
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Frequently Asked Questions
If the income earned from your property comes from activities that do not require any government authority license, then this income is considered natural persons income, and you do not need to pay any corporate tax for this real estate earning. The source of this income can be direct or indirect, and it could be from any mode of earning, such as selling, leasing, sub-leasing, and renting land or real estate property in the UAE.
A non-resident will be recognized as having a PE in the UAE if they have a fixed place of business or a dependent agency there. The language employed in the Law to define these tests appears to broadly mirror the Organization for Economic Co-operation and Development (OECD) guidelines. Any further nexus in the UAE that might lead to a PE would be resolved by a Ministerial Decision, in accordance with the Corporate Tax Law.
Any legal entity or individual based in the UAE who has annual revenues below the Minister’s threshold and who satisfies any further requirements may apply for a small business exemption.
The following rates for UAE CT will apply to entities based in a free zone that satisfy the requirements to take advantage of the free zone CT system (“Qualifying Free Zone Persons”).
- Qualifying Income – 0%.
- 9% of Taxable Income that does not fall within the criteria of Qualifying Income
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