Analytics and brochures

The UAE Corporate Tax Law does not provide for separate tax accounting. The initial basis for calculating the corporate tax base is the financial statements, i.e. accounting data. This data is subject to adjustment in cases where the accounting rules of a particular transaction differ from the rules established for tax purposes. Read more in the article of Andrey Nikonov, Senior Partner. 

The institute of a tax assessment review has been launched by Art. 28(1) of the new Law on Tax Procedures, i.e. it is applicable from March 1, 2023. It has added an optional tier, a new opportunity to have a tax assessment dismissed or decreased. Previously a taxpayer could only file a reconsideration request with the FTA to challenge an assessment. This filing was (and continues to be) an obligatory step to pass the dispute to external institutions (the Tax Dispute Resolution Committee (TDRC) under the jurisdiction of the Ministry of Justice and federal courts). Read more in the article of Andrey Nikonov, Senior Partner. 

Corporate tax has been put into application in the United Arab Emirates starting from 1 June this year. The first tax period for Emirati companies will be the first calendar year or a 12-month period after 1 June for which financial statements are drawn up (articles 57 and 69 of Federal Decree-Law No. 47 (2022) “On the taxation of corporations and businesses” (the “Law on Corporate Tax”)). For most companies, the first tax period will be 2024, and business does not have much time left to prepare for the corporate tax regime in the UAE. Read more in the article of Maria Nikonova, Pepeliaev Group's partner.

Art 3(2)(a) of the UAE Corporate Tax Law (CTL) provides for a 0 percent tax rate for Qualifying Income. Art 18(1)(b) of this Law vests the Cabinet with authority ‘to specify’ Qualifying Income. The Cabinet in Decision No. 55/2023 delegated to the UAE Minister of Finance (the MoF) power to list the Qualifying Activities, i.e. activities which generate Qualifying Income. On 1st June 2023, the MoF released Decision No. 139 with such list.