Corporate Tax

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Unveiling the Dynamics of Corporate Tax: Insights into the UAE's Tax Landscape and Compliance Guidelines

Corporate Tax is a form of direct tax levied on the net income or profit of corporations and other businesses. Corporate tax is adopted by 225+ countries around the world. Corporate Tax is sometimes also referred as “Corporate Income Tax” or “Business Profits Tax” in other jurisdictions.

On 9 December 2022, the UAE Ministry of Finance has officially published the much-awaited full text of the Corporate Tax Law titled as Federal Decree-Law No. 47 of 2022.

The law states the business community in the UAE will be subject to Corporate Tax from the beginning of their first financial year that starts on or after 1 June 2023.

Corporate Tax year starts from 1 January 2024 for the companies whose financial year is January to December.  Such companies will be filing their first corporate tax returns + paying their taxes (if due) in the year 2025 for the year January to December 2024.

Taxable Persons must file Corporate Tax returns for a Tax Period/Year within 9 months from the end of a specific tax period/year. This same deadline also applies on the payment of all the Corporate Taxes Due for the same Tax Period/Year for which the return is filed.

A standard rate of 9% tax will be applicable only to the taxable income/profit which exceeds a threshold of AED 375,000 per annum. A rate of 0% tax will be applicable to the taxable income/profit not exceeding that threshold means taxable income/profit below AED 375,000 per annum will be taxed at 0%.

TAXABLE INCOME/PROFIT SLAB

Taxable income/profit up to AED 375,000

Taxable income/profit above AED 375,000

Large Multinational Businesses
(with consolidated global revenue > AED 3.15Bn (Euro 750mn)

UAE CORPORATE TAX RATE

0%

9%

Different tax rate
(with reference to Pillar 2 of BEPS 2.0)

At Xecutiv FBS, we play the role of your Corporate Tax Experts and Advisors, and we work closely to chop down your burdens of tax complexity. We all the way look after your Corporate Tax related matters.

As per the FTA's Federal Decree Law 47, The Corporate/Federal Tax Authority demands every taxable person (including a Free Zone Person) requires to register for Corporate Tax and get a registration number issued from FTA. The Federal Tax Authority also requested that even the Exempted Persons should register for Corporate Tax. 

The UAE Corporate tax registration applies to all businesses whether they are subject to 0 percent or 9 percent corporation tax.

The Federal Tax Authority has announced pre-registration of corporate tax in the EmaraTax portal. It is an online portal for taxpayers to handle all the Tax registrations, returns, refunds, deregistration and payment in one platform.  

At Xecutiv FBS, we have the experienced tax consultants with substantial proficiency in the process and rules of Corporate Tax registration. We get your corporate tax registration done in timely manner and we ensure to comply with the tax regulations.

It is important for the business community operating in the UAE to assess the possible implication of corporate tax on their business operations, corporate structure, financial management and accounting arrangements.

Compliance with the corporate tax regulations in the UAE is mandatory, and businesses must get reviewed their internal finance and accounting structure from the Corporate Tax experts at the earliest possible time. Moreover, it is necessary for businesses to have proactive knowledge of the aspects that apply to almost all businesses in the UAE. Tax consultation services are especially useful for businesses that are expanding globally or establishing themselves in the UAE.

Our Advisory Services include but not limited to:

  • Detailed review of the books of accounts and financial statements of the current and past years to find out the gaps and areas of improvements which subsequently help in redecorating the books and in Tax Planning.
  • Tax consultancy to make sure an effective tax planning and 100% compliance.
  • Consultancy on the Corporate tax grouping and group restructuring in order to maximize the tax rebates and benefits for our clients
  • Consultancy on domestic and cross-border transactions involving related entities, taking into account transfer pricing implications.
  • Consultancy on satisfying the withholding tax obligations and minimizing tax burden.
  • Corporate tax due diligence services to assess the accurate tax position of a company.
  • Corporate tax return preparation and filing of returns with FTA

AT Xecutiv FBS, with the help of our tax experts, businesses can identify proven tax strategies for reducing their tax burden. We all the way execute the duties of preparing the corporate tax returns and doing the complex calculations. We provide businesses with the latest updates about taxation policies, ensuring that they remain compliant with regulatory requirements.

Corporate tax training is essential for businesses to ensure compliance and optimize tax strategies. It helps a company to reduce the risk of penalties and legal issues. Training equips staff with the skills and knowledge to efficiently manage tax processes, reducing administrative burdens.

It typically covers areas such as:

  • Tax Laws and Regulations: Understanding the ever-evolving tax laws and regulations that apply to businesses is fundamental.
  • Tax Planning: Strategies to legally minimize tax liabilities and take advantage of available tax incentives.
  • Financial Reporting: How tax impacts financial statements and the importance of accurate reporting.
  • Transfer Pricing: Managing intercompany transactions to ensure compliance and prevent transfer pricing disputes.
  • Tax Compliance: Navigating the preparation and filing of corporate tax returns.
  • International Taxation: Dealing with tax implications of cross-border operations and transfer pricing.
  • Tax Audits: How to prepare for and handle tax audits effectively.
  • Tax Technology: Utilizing software and tools for efficient tax management and compliance.

 

At Xecutiv FBS, our team of experts deliver well-organized lessons and materials which help you to remain focused on the topic at hand, instead of jumping around. One of the most important qualities of our trainers is their ability to keep their eye on the goal and handle limitations without compromising on training quality.

A corporate tax audit is an examination by the federal tax authority to ensure a business has accurately reported its income, deductions, and credits on its tax returns. It's essential to maintain accurate financial records and cooperate fully with tax authority during an audit. If you're facing one, consider consulting a tax professional from Xecutiv FBS for guidance and support.

Taxpayers are expected to prepare and maintain financial statements of their businesses and should maintain all documents and records that support the information in the financial statements as well as in the Corporate Tax Returns filed with the tax authority. Records and documents should be kept for at least seven years following the end of the relevant Tax Period. The Federal Tax Authority has the right to conduct a tax audit at any point of time and authority can demand for the audited financial statements along with the supporting documents.

It is always recommended to get the books of accounts audited to have clean records to be able to comply with any law relating to the financials and to have a clear understanding of the profit or loss and the financial position of the business.

At Xecutiv FBS, our tax audit consultants play a crucial role in helping businesses navigate tax audits effectively. We assist in negotiating and resolving any discrepancies or disputes with tax authority.

Corporate tax accounting refers to the process of recording and reporting a company's financial transactions and results in a manner that complies with tax laws and regulations.

Here are some key aspects of corporate tax accounting:

  • Taxable Income Calculation: Corporate tax accountants determine a company's taxable income by starting with financial accounting income and making necessary adjustments for tax purposes. This involves identifying deductible expenses and applying tax credits.
  • Financial Statements: Corporate tax accountants prepare financial statements (such as income statements, balance sheets, and cash flow statements) that are adjusted for tax purposes to reflect a company's tax liability accurately.
  • Book-Tax Differences: Corporate tax accounting often involves recognizing differences between financial accounting and tax accounting, which can arise due to variations in accounting rules and tax regulations.
  • Tax Planning: They engage in tax planning to minimize a company's tax liability through various strategies, such as taking advantage of tax deductions and credits, structuring transactions efficiently, and managing the timing of income and expenses.
  • Record Keeping: Keeping comprehensive and well-organized records of financial transactions and tax-related documents is essential to support tax filings and potential audits.
  • Compliance Reporting: Corporate tax accountants are responsible for preparing and submitting tax forms, schedules, and supporting documentation as required by tax authorities.

 

At Xecutiv FBS, we play the role of your outsourced Corporate Tax Accountants, and we effectively manage the tax accounting process and help businesses to manage their tax liabilities systematically, minimize the risk of tax audits, and ensure compliance with the ever-evolving tax laws and regulations.

BENEFITS OF OUTSOURCING YOUR CORPORATE TAX RELATED TASKS TO XECUTIV FBS

Experience the peace of mind that comes with entrusting your financial tasks to Xecutiv FBS.

  • Confidential & Secured Information
  • Expertise Support
  • Cost Effective Solutions
  • No Hiring and Visa Cost
  • Surety On Compliance with Laws & Standards
  • Gain A Competitive Edge
  • Internal Staff Knowledge Development
  • Wide Range of Services