service
Corporate Tax
Maximize your profits, and minimize your taxes
Corporate Tax Services are crucial as they provide assurance that your tax compliance is accurate and in accordance with applicable laws and regulations, instilling confidence in stakeholders that your tax position is fair and reliable. As a reputable provider of Corporate Tax Services in Abu Dhabi and Dubai, we can help enhance your internal tax processes and gain a deeper understanding of your company’s tax situation.
benefits
Benefits Of Corporate Tax Services
With our assistance, you can focus on driving business growth and maximizing profitability while leaving the complexities of tax compliance to us. Our Corporate Tax Services can help your company unlock significant advantages which are listed here.
If you want to optimize your tax position and minimize risk while gaining a comprehensive understanding of your business’s tax profile, our expert team can analyze your tax strategy, identify potential areas for improvement, and help you stay compliant with the latest tax laws and regulations. Contact us today to unlock the full potential of your business.
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Accurate and timely tax compliance
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Greater transparency and credibility
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Identification of tax risks and opportunities
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Reduction of tax-related risks and errors
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Expert guidance on tax-related issues
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Cost savings through optimized tax strategies
Are You Ready?
Are you ready to navigate the UAE's new corporate tax law? Look no further! Our team of tax experts is here to provide you with the guidance and support you need. Whether you're unsure if corporate tax applies to your business, seeking to maximize tax exemptions and reliefs, or aiming to ensure timely compliance with requirements to avoid penalties, we've got you covered.
Step-by-Step Assistance:
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Registration: Starting from June 2023, it is essential for every business to register for corporate tax. Our team will assist you throughout the registration process, ensuring that you meet all the necessary criteria.
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Accounting Records: Keeping proper accounting records is crucial. Our experts will guide you on the best practices and help you maintain accurate records to comply with corporate tax regulations.
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Corporate Tax Submission: Filing your corporate tax submission accurately and on time is vital. Our team will be by your side, providing comprehensive support and ensuring that all necessary documents are prepared and submitted correctly.
Corporate Tax in the UAE : Explained
Tax vs Vat
Corporate Tax vs. VAT: Understanding the Differences
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Corporate Tax:
Corporate tax in the UAE is distinct from Value Added Tax (VAT) and operates differently in terms of its purpose and implementation. Here's a breakdown of the key disparities:
Nature:
Corporate tax is levied on businesses' taxable income, specifically targeting their annual net profits. The tax is paid directly to the government, considering the company's net income, rather than total revenue or sales volume.
Collection Process:
Businesses are responsible for calculating and paying corporate tax based on their annual financial statements. It is a direct tax that companies must remit to the government.
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VAT:
Corporate tax in the UAE is distinct from Value Added Tax (VAT) and operates differently in terms of its purpose and implementation. Here's a breakdown of the key disparities:
Nature:
VAT, on the other hand, is a consumption tax imposed on the sale of goods and services. It is a tax paid by the end consumer at the time of purchase.
Collection Process:
Businesses that are registered for VAT collect the tax from their customers during sales transactions. They then remit the collected VAT to the government.
Understanding Corporate Tax in the UAE
- Businesses reporting financial years from July 1 will commence tax calculation from July 1, 2023.
- Businesses reporting financial years from January 1 will commence tax calculation from January 1, 2024.
- Governmental or Public Entities:
- This exemption covers federal and regional offices, departments, divisions, and all other public institutions.
- Natural Resources Extraction or Mining Businesses:
- These entities are already subject to Emirate-level taxation and, therefore, are not required to file separate corporate tax reports.
- Charitable and Social Organizations:
- Businesses engaged in charitable and social causes must register as social or charity organizations with the MOF. However, eligibility for exemption requires obtaining formal clearance from relevant authorities before applying for MOF registration.
- Public or Regulated Private Entities with Social Benefit Funds:
- Entities involved in managing social benefit funds, such as pension or retirement planning, may qualify for exemption but must seek formal approval from both the MOF and the Federal Tax Authority (FTA).
- Real Estate and Regulated Investment Funds:
- Similar to charitable organizations, these funds must apply for exemption approval from both the MOF and the FTA.
- UAE Government-Owned Companies:
- Companies fully owned by the UAE government and listed with a ministry-level decision can receive tax exemption.
Understanding the distinctions between corporate tax and VAT, as well as the guidelines for its implementation and exemptions, is crucial for businesses operating in the UAE.
tax rates
Corporate Tax Rates in the UAE: An Overview
The UAE Ministry of Finance (MOF) has established a comprehensive corporate tax framework with specific tax rates based on the annual net profit of businesses. Here are the key tax tiers:
For such companies, the specific tax rate and regulations will be determined based on the guidelines outlined in the ‘Pillar Two’ framework, which focuses on combating tax avoidance and ensuring fair taxation practices on a global scale.
It is important for businesses to understand the applicable tax rates and regulations based on their net yearly profit and multinational status to fulfill their tax obligations in the UAE.
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Net Yearly Profit up to AED 375,000:
For businesses with a net yearly profit up to AED 375,000, the corporate tax rate is set at 0%. Such companies are exempt from paying corporate taxes and can retain their entire profit.
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Net Yearly Profit above AED 375,000:
Businesses with a net yearly profit exceeding AED 375,000 are subject to a corporate tax rate of 9%. These companies are required to pay 9% of their taxable income as corporate taxes.
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Large Multinational Companies:
Large multinational companies fall under a separate taxation policy known as 'Pillar Two' of the OECD Base Erosion and Profit Shifting project. This category includes companies with a total global revenue exceeding EUR 750 million (equivalent to AED 3.15 billion).
brief
Corporate Tax Administration in the UAE: A Brief Overview
The UAE Ministry of Finance (MOF) has appointed the Federal Tax Authority (FTA) to oversee corporate tax administration and regulatory compliance. Here's a concise summary:
Compliance with the FTA’s guidelines is essential for businesses in the UAE to meet corporate tax obligations effectively.
Tax Filing and Financial Reporting: Businesses must file their corporate tax returns annually, accompanied by financial reports. While many companies follow International Financial Reporting Standards (IFRS), the FTA accepts alternative methods for simplified tax filing.
Online Filing Process: Tax filing is completed online through the FTA's platform, offering convenience for businesses.
Registration with the FTA: Companies operating in the UAE must register with the FTA for tax filing purposes. Registration is generally voluntary, but enforcement is possible.
Deadline for Tax Filing and Reporting: Businesses have nine months from the end of their financial year to fulfill tax filing obligations and submit financial reports to the FTA.
Get in Touch Today!
We can help your business register with all relevant tax authorities and ease your business management.
