Corporate Tax in UAE
The Corporate Tax is a direct tax applied on the net income or profit of corporations and businesses.
The UAE Ministry of Finance announced the establishment of a federal corporate tax effective for fiscal years starting off on or after 1 June 2023 on 31 January 2022.
In general, these taxes are estimated based on the accounting net profit/income of a corporation after adjusting for specific items as prescribed by UAE Corporate Tax decree law.
What is Corporate Tax?
In the extremely complex fields of Corporate Tax reporting, tax authority compliance, and tax planning, in-house tax departments frequently face the problem of adapting to ever-changing regulations. Our seasoned professionals with industry and Corporate Tax expertise can enhance your organization’s professionals to enable a smooth transition to the newly implemented Corporate Tax in the UAE.
Both our clients and our peers respect our experience, efficiency, attention to detail, and exceptional service.
Whether your organization is a start-up or a large, well-established enterprise, our team of professionals will utilize their years of tax knowledge and resources to assist you identifying risk areas and provide solutions to manage financial risk and tax compliance exposures.
Rates of Corporate Income Tax in the UAE
According to the UAE Ministry of Finance, the following are the Corporate Income Tax rates:
0% CIT for income up to AED 375,000 that are taxable.
9% CIT on income above AED 375,000.
Large corporations that meet the specific conditions connected to Pillar Two of the OECD Base Erosion & Profit-Sharing Project will be subject to a different tax rate.
Why Do You Need Corporate Tax Experts?
Tax Experts are required for businesses because tax laws and regulations can be complex and ever-changing, making it challenging for businesses to comply with the law. Tax consultants have the expertise and experience to navigate the tax laws and regulations and help businesses minimize their tax liability through effective tax planning and strategy.
Tax advisors can also assist with tax compliance and preparation, and handle tax disputes and audits. Additionally, tax advisors can provide valuable insights and advice on tax-saving opportunities, such as tax incentives and deductions. In short, tax advisors help businesses save time, money, and ensure compliance with tax laws.
Corporate Tax Service
Our Corporate Tax team aids businesses in achieving tax compliance obligations by providing various services, such as:
- Corporate tax assessment
- Corporate tax Implementation
- General Compliance Service
- Corporate Tax Registration
- Calculation of taxes payable
- Preparation of Corporate Tax returns and other tax reporting documents.
- Review of the tax return prepared by the organization.
- Assistance with correspondence with the tax authorities if the authorities have raised questions.
- Coordinating with authorities to resolve potential tax disputes
Four-step Action Plan for UAE Corporate Tax Services
- Conduct an initial evaluation of the anticipated impact of the outline of the UAE Corporate Tax Law on existing operations.
- Conduct a system analysis to identify data gaps necessary for compliance with UAE Corporate Tax.
- Identify significant impact areas resulting from the implementation of Corporate Tax.
- Determine ambiguous positions and critical decision points
- Determine reorganization and optimization.
- Possibilities for your legal framework or business operations to reduce administrative complications.
- Perform a gap analysis to determine what system modifications are necessary to meet financial information and compliance needs.
- Modify legal contracts and other agreements.
- Analyze revenue and operations, and adopt transfer pricing policies and documentation as necessary.
- Make modifications to the legal structure.
- Revise SOPs in light of the corporation tax laws and regulations.
- Change business application software.
- Assessment for Corporate Tax Group Registration and Exemption.
- Obtain clarifications and tax judgments in advance.
- Perform a transfer pricing risk and opportunity analysis to determine the necessary improvements to the transfer pricing policy.
- Tax registrations for corporations
- Apply for tax exemptions and tax groups
- Submit CT returns.
- Prepare transfer pricing documentation.
- Tax processing.
frequently asked questions
UAE Corporate Tax will be effective for all UAE firms and commercial operations, with the exception of natural resource extraction, which is subject to corporate taxation at the Emirate level.
Whether the Corporate Tax in the UAE applies to single proprietors or exclusively to corporate entities?
If a person engages in a trade or activity in the UAE on a continuous or recurring basis, they will be subject to UAE tax. Therefore, while a person's pay or other employment benefits do not fall under the purview of Corporate Tax, an individual with a commercial license to conduct business in the UAE will be subject to UAE Corporate Tax.
Free zone firms will be subject to UAE Corporate Tax; hence, all compliance requirements outlined in the Regulations must be met. However the new regulations will continue to honor the tax incentives currently granted to free zone enterprises that meet all legal requirements and do not conduct business with the UAE mainland.
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I was very pleased with the professional Corporate Tax services that I received from ADEPTS team. They were extremely helpful in helping me understand and fulfill my tax obligations as a business owner. They provided me with a comprehensive range of services, from general compliance to corporate tax registration and calculating taxes payable. Furthermore, they were more than willing to answer any questions that I had about the process.
The team helped me a great deal when it came to preparing and filing all necessary documents for the transfer pricing process. They made sure that all deadlines were met and that everything was filed in an accurate, timely manner according to the laws governing UAE's taxation system.
Why Choose ADEPTS
ADEPTS Chartered Accountants LLC is a premier accounting and bookkeeping firm in UAE, offering reliable services to manage income and expenditure, as well as helping clients to adhere to International Financial Reporting Standards (IFRS). Our team of professional financial advisors provides cost-effective solutions to meet long-term goals with exceptional accuracy and precision.
We provide a personalized service, taking the time to understand your business operations, goals, and challenges to provide tailored tax advice that is specific to your needs.
For your convenience, we offer a full suite of tax advising services, including assistance with tax preparation, audit defense, and dispute settlement.
We are dedicated to delivering services that are both effective and timely, giving you the data and guidance you need to handle your company's tax matters with confidence.
We take a proactive approach, identifying potential tax issues and providing solutions to mitigate them, helping you to avoid any unnecessary penalties or fines.
Our tax advice is priced competitively to provide you the best value possible.