- Tax planning and structure
- Tax Preparation
- Assisting you in determining the impact of legislative changes on your business structure and adapting your tax approach
- Advising you on the tax consequences of potential transactions
- Assisting you with business reorganisations
- Examining the tax implications of company agreements or other legal documents
- Assisting with the filing of the Corporate Tax Return
Corporate Tax Consultancy Services in UAE
Corporate Tax in UAE is a type of direct tax applied on corporations or other businesses’ net revenue or profit. On June 1, 2023, UAE implemented a federal corporate tax system. This imposes a 9% tax rate on profits exceeding AED 375,000. Certain exemptions and relief measures are available, particularly for individuals, businesspeople, small business entities, and entities located in free zones, etc. If your business operates in the UAE, it is essential to commence preparations for the corporate tax framework. This entails gaining a comprehensive understanding of the preparation of financial statements with internationally accepted accounting standards, understanding deductible and non-deductible expenses, rules related to tax losses, transitional provisions, transfer pricing rules, freezone exception conditions, tax group participation exception, corporate tax rates, available exemptions, and relief provisions. Additionally, you should be equipped to navigate tax calculations and the filing process. Seeking the assistance of corporate tax consultants in UAE may be a wise decision to facilitate this transition. Accruon Consultant stands as a leading corporate tax consultants in UAE having more than 25 years of expertise in handling various direct and indirect tax laws and thus being the professional tax consultancy service in UAE.
Corporate Tax Compliance in UAE – Stay Legally Compliant
The corporate tax compliance audit is a process where a corporate tax expert scrutinizes a business’s financial transactions and records to verify its adherence to the UAE’s corporate tax law. Corporate tax compliance audit is advisable for all businesses with corporate tax liabilities in the UAE. Non-compliance with the UAE’s corporate tax law can result in severe penalties. Businesses that fail to file tax returns or remit the correct tax amount may face fines, interest charges, and potential criminal prosecution. Accruon Consultants LLC, reliable tax consultants in UAE can help you with corporate tax compliance audit.
Corporate Tax Registration in UAE
Corporate Tax registration in UAE is mandatory for all taxable persons, including public joint stock companies (PJSCs), private companies, natural persons conducting business or business activity in the UAE, and non-resident juridical persons (foreign legal entities) that have a Permanent Establishment in the UAE. To register for Corporate Tax in UAE, create an account on the EmaraTax portal, create your taxable person, or select the relevant taxable person from the taxable person list. Choose the “Corporate Tax” option and complete your registration. The required documents for registration are a trade license, where applicable Emirates ID/passport of the applicant (if a natural person) or an authorized signatory (if legal person), and proof of authorization for the authorized signatory (if legal person). The registration process typically takes 20 business days. If your application is incomplete, the FTA will notify you, and you will need to provide the additional information within 60 calendar days. Our expert tax consultancy service in UAE could assist you with the tax registration process.
Corporate tax documentation in UAE
The necessary corporate tax documentation in UAE can vary depending on the business type and its structure. Nevertheless, some standard documents might be necessary, such as Corporate tax registration certificates, financial statements, transfer pricing documents, tax returns, supporting documents for deductions and exemptions, evidence of foreign tax credits, and any other documents relevant to calculating corporate tax liability. The Federal Tax Authority (FTA) has provided a list of the documentation needed for corporate tax filing on its website. In addition to the mandatory documentation, businesses may also find it beneficial to maintain additional records that could be useful in case of an audit by the FTA.
Corporate tax UAE return filing
To fulfill corporate tax obligations, the tax return must be electronically filed using the EmaraTax e-filing system provided by the Federal Tax Authority (FTA). This filing must occur within nine months following the conclusion of the relevant tax period. The corporate tax return should contain the following essential details:
- The company's name and registration number
- Financial statements of the company for the applicable tax period
- The company's taxable profits
- The amount of corporate tax payable
Various deductions and exemptions are available for corporate tax purposes, including provisions for depreciation and amortization, allowances for bad debts, deductions for charitable donations, and foreign tax credits. Businesses uncertain about their corporate tax obligations are advised to consult with a professional tax advisor, and you can reach out us as we are the pioneers of tax consultants in UAE.
Transfer pricing documentation
The United Arab Emirates (UAE) implemented transfer pricing (TP) regulations and documentation under its Corporate Tax Law (CT Law) in 2023. These TP regulations adhere to the international arm’s length principle, serving as a global standard for determining appropriate transaction pricing among affiliated entities. The CT Law mandates that taxpayers must maintain TP documentation if they meet specific criteria, including:
- When the taxpayer's revenue in a relevant tax period amounts to at least AED 200 million.
- When the taxpayer is part of a multinational enterprise (MNE) group with a total consolidated group revenue of at least AED 3.15 billion in the relevant tax period.
Additionally, the CT Law stipulates that taxpayers must submit a transfer pricing disclosure form along with their annual tax return, providing information on related party transactions subject to TP documentation requirements. The UAE tax authorities possess the authority to request additional information from taxpayers if they harbor any doubts regarding the accuracy or completeness of the TP documentation. Failure to comply with TP documentation requirements may result in penalties. For UAE taxpayers subject to TP documentation requirements, it is advisable to seek guidance from a tax advisor to ensure compliance with the law and proper documentation of TP transactions.
Related Party Transactions in CT Law
A related party is a person who either directly or indirectly possesses the ability to control, be controlled by, or share common control with another individual or entity. For the CT Law, control implies having the capacity to exert a dominant influence over the management, financial, or operational policies of another entity. This influence may be exercised through ownership of shares, voting rights, or other means. It’s essential to note that the CT Law outlines specific, intricate criteria for determining whether two entities qualify as related parties, and it is advisable to consult a tax advisor to understand these regulations thoroughly. The CT Law also introduces particular regulations governing transactions involving related parties. These regulations are designed to prevent related parties from manipulating the prices of goods or services exchanged between them to reduce their tax obligations. For instance, the CT Law mandates that all transactions involving related parties must adhere to the arm’s length principle. This principle requires that the prices for goods or services match those that would be charged in transactions between unrelated parties. Additionally, related parties must maintain proper documentation to substantiate the prices of their transactions, and this documentation must be retained for a minimum of five years. Businesses subject to the CT Law should carefully evaluate the implications of these related party rules, as non-compliance can lead to penalties and interest charges.