Assistance in VAT & Accounting

VAT was introduced by the UAE government on January 1, 2018. It was implemented to most of the goods and services at a 5% rate. There are certain sectors completely exempt from VAT such as transportation, real estate, financial services. If you have a new business in Dubai, you might feel overwhelmed by the VAT obligations. We can understand that you may not have all the required information if you have just started. VAT accounting is a rigorous process and we make it possible with meticulous documentation. Golden Fortune provides assistance in VAT in Dubai. We guide you throughout the entire process and prevent you from making costly errors. We carefully handle each aspect of VAT for excellence.

Assistance in Accounting in Dubai

Businesses in Dubai are required to follow the Accounting Standards. Despite the absence of federal tax on income and wages, it is inevitable to create a reliable accounting structure. You have to follow the standard accounting practices for producing accurate information and analysis required for strategic decision-making. Accounting statements represent the true and fair view of your company and hence should be accurate. There are additional requirements for filing audited financial statements. Shareholders also need to hold accounts.

Why choose Golden Fortune for Assistance in VAT & Accounting

We are committed entirely to your welfare and provide every possible help pertaining to VAT & Accounting. Here are the factors that make us stand out from the competition.

VAT determination & Filing: We undertake the complete process precisely. We prepare all the required documents and save your time.

Accounting & Bookkeeping: Our financial consultants guide you in preparing various books for keeping your business on a sound financial note.

Transparency: We believe in disclosing complete information. Along with that, we provide you every bit of your transactions with us. We provide assistance in VAT & Accounting in Dubai and ensure there are no hidden fees involved.

FAQ

Learn about TAX

Corporate Tax is a form of direct tax levied on the net income or profit of the Company.

UAE CT applies to each company or LLC incorporated in the UAE. In simple terms who has a Trade licence and doing the business in UAE then corporate tax will apply to those businesses.


Individuals will be subject to CT only if they are engaged in a business or business activity in the UAE.

All Taxable Persons (who’s doing business or business activity) will be required to register for UAE Corporate Tax and obtain a Corporate Tax Registration Number.



All Taxable Persons must be registered before they file their first Corporate Tax Return.

Example: for the Financial Year 2024 (01-01-2024 to 31-12-2024), then need to register and file the corporate Tax Return on or before 30-09-2025.

There is no registration threshold for UAE Corporate Tax.   

No, Corporate tax and VAT are two different types of taxes. Both will continue to apply in the UAE.

No, CT and Excise Tax are two different types of taxes. Both will continue to apply in the UAE.

For UAE CT purposes, the financial statements of UAE entities and other businesses should be prepared in accordance with accounting standards accepted in the UAE. International Financial Reporting Standards (IFRS) is the most frequently used accounting standard in the UAE.

The UAE CT regime will become effective for financial years starting on or after 1 June 2023.

Examples:

> A business that has a financial year starting on 1 July 2023 and ending on 30 June 2024 will become subject to UAE CT from 1 July 2023 (which is the beginning of the first financial year that starts on or after 1 June 2023).

> A business that has a financial year starting on 1 January 2023 and ending on 31 December 2023 will become subject to UAE CT from 1 January 2024 (which is the beginning of the first financial year that starts on or after 1 June 2023).

Taxpayer

Applicable CT rate

Individuals and Companies, LLC etc.,

 

 

> 0% for taxable income up to and including AED 375,000 (this amount is to be confirmed in a Cabinet Decision)

> 9% for taxable income exceeding AED 375,000

 Qualifying Free Zone Persons

 

 

> 0% on qualifying income

> 9% on taxable income that does not meet the qualifying income definition

A Individual person shall be subject to UAE Corporate Tax in case they derive an annual Turnover exceeding AED 1 million from a ‘Business’ or ‘Business Activity’ in the UAE.

Businesses with Revenues of AED 3 million or below in a relevant Tax Period and previous Tax Periods can elect for ‘Small Business Relief’ for Tax Periods that end on or before 31 December 2026.

Electing for Small Business Relief means that a Taxable Person will be treated as having no Taxable Income during the relevant Tax Period and that they can benefit from simplified compliance obligations. To claim Small Business Relief, an election must be made in the Taxable Person’s Corporate Tax Return in the relevant Tax Period. 

The Free Zone Corporate Tax is a form of UAE Corporate Tax relief which enables Free Zone companies and branches that meet certain conditions to benefit from a preferential 0% Corporate Tax rate on income from qualifying activities and transactions.

A Qualifying Free Zone Person is a Free Zone Person that meets all the conditions of the Free Zone Corporate Tax regime and hence benefits from that regime.

The conditions of the Free Zone Corporate Tax Regime require a Qualifying Free Zone Person to:

> Maintain adequate substance in a Free Zone;

> Derive Qualifying Income;

> Not have made an election to be subject to the regular UAE Corporate Tax regime;

> Comply with arm’s length principle and transfer pricing rules and documentation requirements;

> Prepare and maintain audited financial statements

Failure to meet any of the conditions results in a Qualifying Free Zone Person losing its qualifying status and not being able to benefit from the Free Zone Corporate Tax regime for five (5) Tax Periods.

Qualifying Activities are activities that can benefit from the Free Zone Corporate Tax regime regardless of whether the income is derived from transactions with another Free Zone Person, a Person in the mainland UAE, or from a foreign Person. The following are Qualifying Activities:

> Manufacturing of goods or materials

> Processing of goods or materials

> Holding of shares and other securities

> Ownership, management and operation of ships

> Reinsurance services

> Fund management services

> Wealth and investment management services

> Headquarter services to Related Parties

> Treasury and financing services to Related Parties

> Financing and leasing of aircraft, including engines and rotables

> Distribution of goods or materials in or from a Designated Zone

> Logistics services

Excluded Activities are activities that would disqualify a Qualifying Free Zone Person from the Free Zone Corporate Tax regime, irrespective of whether those activities are performed exclusively within the Free Zone and regardless of whether the related income is derived from transactions with a Free Zone Person or as part of undertaking a Qualifying Activity.

The following are Excluded Activities:

> Transaction with natural persons, except in relation to:

i Ownership, management and operation of ships

ii Fund management services*

iii Wealth and investment management services*

iv Financing and leasing of aircraft

> Regulated banking activities

> Regulated insurance activities, other than reinsurance services

Transfer pricing rules seek to ensure that transactions between Related Parties are carried out on arm’s length terms, as if the transaction was carried out between independent parties. To prevent the manipulation of taxable income, various articles in the Corporate Tax Law require that the consideration of transactions with Related Parties and Connected Persons needs to be determined by reference to their “Market Value”.

Yes. Transfer pricing rules apply to UAE businesses that have transactions with Related Parties and Connected Persons, irrespective of whether the Related Parties or Connected Persons are located in the UAE mainland, a Free Zone or in a foreign jurisdiction.

Generally, Related Parties of an individual refer to the individual’s relatives as well as companies in which the individual, alone or together with their Related Parties, has a controlling ownership interest (typically 50% or more of shares of the company).

Similarly, Related Parties of a company refers to any other companies in which the company, alone or together with their Related Parties, has a controlling ownership interest (typically 50% or more of shares of the company), or that are under greater than 50% common ownership.

Connected Persons are different from Related Parties. A person will be considered “connected” to a business that is within the scope of UAE CT if they are:

> The owner of the business;

> A director or officer of the business; or

> A Related Party of either of the above.

A business is required to prepare and file only one UAE corporate tax return and other related supporting schedules with the FTA for each tax period. Furthermore, businesses need to satisfy the following conditions:

  • Businesses must submit the tax return along with supporting documents to the FTA within (9) nine months of the end of the relevant Tax Period.
  • Payments to settle the corporate tax liability for a tax period must be made within (9) nine months of the end of the relevant Tax Period.
  • A taxpayer can apply for a tax refund request to the FTA if it can demonstrate that a corporate tax refund may be due.

As long as a company, LLC is registered, they are required to file a Corporate Tax Return, irrespective of the level of income or the status of the company. This is subject to the Corporate Tax Law which requires a Person to deregister where they have ceased to carry on a Business or Business Activity. Deregistered Persons are not required to file a Corporate Tax Return.

Similar to other taxes in the UAE (e.g., VAT), businesses will be subject to penalties for non-compliance with the UAE Corporate Tax regime.