More Frequently Asked Questions
Do all emirates apply VAT?
Some apply VAT whilst others don’t.
More popular destination for freezone business Dubai has introduced the VAT and so did the Saudi Arabia. On the other hand, Qatar, another popular destination has no intention of introducing it at the time being and thus is more preferred by some businesses.
Does the UAE (Dubai) apply Corporation Tax?
Not yet but they will for year endings commencing 1st of June 2023.
The FTA (federal tax authority) has introduced the Corporation Tax which will apply to all emirates commencing in 2023 and being accrued for payment in 2024.
Good news for everyone; the tax does not apply for profits generated outside the UAE hence nothing really changes for businesses and HNWIs (High Net Worth Individuals) who trade outside the UAE.
What will the rate of Corporation Tax be?
CT Rate is 9% for taxable income above AED 375,000. Below that amount there is no tax due!
What happens if my tax is within the UAE? Is there room for manoeuvre?
Yes. Tax planning can be applied. UAE profits derived from sales within the UAE are taxed and to reduce this there are several options we can assist you with.
When will the Corporation Tax be payable?
Approximately 9 months after the year end.
Is there a requirement for provisional tax payment etc (upfront of current years tax)?
Is the UAE tax system sophisticated like the EU?
Yes, to everyone’s surprise the UAE tax system is sophisticated and straightforward!
Is it easy to create a local company in the UAE?
Yes. With more than few years of experience in the Company creation and banking services in the UAE we can now share that the UAE is up to speed both with Company formation and banking incorporation.
Is it easy to open a local bank account?
It is a straightforward process with the peculiarities that we know as local service providers; unlike the company formation opening a bank account for an international company or HNWI requires local knowledge and expertise. Having said this, the client experiences a smooth process.
Local filing requirements?
Accounting and audit work will be required almost by all UAE.