Corporate and Individual Taxation in the United Arab Emirates
Individual & Corporate Tax in UAE: Ministerial Decision No. 114 of 2023 Regarding Accounting Standards and Methods Under Federal Decree Law No. 47 of 2022 Concerning the Taxation of Corporations and Business Entities.
Ministerial Decision No. 114 of 2023, which pertains to accounting standards and methods for corporate taxation, mandates that any Taxable Entity must adhere to the International Financial Reporting Standards (IFRS). This requirement is applicable to entities with revenues not exceeding AED 50,000,000 (fifty million United Arab Emirates dirhams) and is specifically targeted at small and medium-sized enterprises.
The term “Financial Statements,” as outlined in the decision, encompasses a comprehensive set of financial documents as defined by the applied Accounting Standards. This includes, but is not limited to, the income statement, the statement of other comprehensive income, the balance sheet, the statement of changes in equity, and the cash flow statement.
Corporate Income Tax Services in Dubai
Engaging a specialized tax accountant for both individual and corporate taxation in the UAE is the most efficient strategy for navigating the complexities of tax compliance and registration. If you find yourself burdened with tax-related responsibilities amidst other demanding tasks, MP Elites Consulting is here to offer expert guidance.
You may be tempted to manage your taxes independently, either as a cost-saving measure or in an effort to better understand your financial landscape. However, undertaking this task without professional support could lead you into a labyrinth of intricate accounting terminology, multifaceted taxation regulations, and recent legislative updates that are challenging to interpret.
Don’t allow the stress of tax preparation and filing to overwhelm you. Reach out to us at MP Elites Consulting for insightful advice and comprehensive solutions tailored to your specific needs.
Individual & Corporate Tax in UAE: Expert Guidance for Entrepreneurs and Corporations
We are the leading specialists in the United Arab Emirates, serving a diverse clientele of entrepreneurs and corporations by providing comprehensive assistance in all matters related to taxation in the UAE, including individual VAT registration processes. Below is an overview of key taxation aspects across various sectors and essential information you need to be aware of:
Oil and Gas Sector
Companies operating in the oil and gas sector are subject to negotiated tax rates with governmental authorities. Tax agreements can escalate to as high as 55%.
Banking and Finance Sector
Specific tax regulations apply to the banking industry in major Emirates such as Abu Dhabi, Dubai, and Sharjah. The income generated by foreign bank branches is subject to a 20% income tax. Notably, entities established in UAE free zones may be eligible for tax holidays extending up to 50 years, with options for renewal.
Corporate Tax
Generally, local tax authorities do not levy taxes on the income or wealth of companies, with the exception of foreign banks and oil and gas corporations. The landscape of corporate income tax in the UAE is subject to change; thus, we recommend consulting our expert team for the most current information.
Withholding Tax
Currently, the UAE does not impose any withholding taxes.
Customs Duties
A 5% customs duty is applied to the freight value, insurance, and cost of imports. Special rates may be applicable for certain products like tobacco and alcohol. Importers with the intent of re-exporting goods may be eligible for customs duties discounts or exemptions, as may manufacturers importing raw materials, spare parts, and machinery for industrial use. At present, no separate excise taxes are levied in the UAE.
Personal or Individual Income Tax
As it stands, there is no personal income tax in the UAE. It is important to note that freelancers and social media influencers are legally recognized as business entities.
Value Added for Individual & Corporate Tax in UAE
Although corporate tax is generally not applicable in the UAE, a 5% VAT is levied on a wide range of goods and services. Exceptions are made for basic food items, educational services, and healthcare.
For tailored advice and to keep abreast of the evolving tax landscape in the UAE, consult our team of experts.
Tax Advisory Services in the UAE
We are a team of expert tax consultants, serving as the go-to resource for both businesses and individuals navigating the complexities of taxation in the United Arab Emirates. Here’s how we can assist you:
• Federal Tax Authority (FTA) Investigations and Inquiries: Facing scrutiny from the Federal Tax Authority can be both stressful and overwhelming. Leveraging our extensive experience in managing FTA investigations, we offer you robust support and specialized guidance to navigate these challenging situations.
• Strategic Business Tax Planning: Operating in the UAE tax environment demands expert consultation, particularly for optimizing your tax position. We offer year-round strategic advice to help you manage and plan your tax obligations effectively.
• Compliance and Assessment: The realm of taxation comes with stringent compliance requirements. Our team is equipped to guide you through the nuances of tax planning, helping you identify opportunities and avoid penalties. From accurate tax return preparation to advising on payment options and calculating your tax liabilities, we provide comprehensive services to ensure you meet all regulatory requirements.
Benefit from our network of seasoned tax consultants stationed across the UAE and the Gulf Cooperation Council (GCC) region, dedicated to simplifying taxation for you. Contact us today to consult with our experts.
