Corporate Tax
Corporate Tax
The Federal Decree-Law No. (47) of 2022 on the Taxation of Corporations and Businesses (hereinafter referred to as the “Corporate Tax Law”) was issued by the United Arab Emirates (“UAE”), on 09 December 2022. Corporate Tax is a form of direct tax levied on the net income of corporations and other businesses.
Who is subject to Corporate Tax?
Broadly, Corporate Tax applies to the following “Taxable Persons”:
01.
UAE companies and other juridical persons that are incorporated or effectively managed and controlled in the UAE;
02.
Natural persons (individuals) who conduct a Business or Business Activity in the UAE as specified in a Cabinet Decision to be issued in due course;
03.
Non-resident juridical persons (foreign legal entities) that have a Permanent Establishment in the UAE (which is explained under Section 8).
Corporate Tax Rates :
Corporate Tax will be charged on Taxable Income as follows:
Resident Taxable Persons
Taxable Income not exceeding AED 375,000 0%
Taxable Income exceeding AED 375,000 9%
Qualifying Free Zone Persons
Qualifying Income 0%
Taxable Income that does not meet the Qualifying Income definition 9%
Corporate Tax registration applies to all businesses, whether they are subject to 0% or 9% corporate tax. After registration, businesses must file and pay their taxes in accordance with UAE government regulations. The Tax return must be filed nine months after the relevant Tax Period under the Gregorian calendar of 12 months.
Withholding Tax
A 0% withholding tax may apply to certain types of UAE sourced income paid to non-residents. Because of the 0% rate, in practice, no withholding tax would be due and there will be no withholding tax related registration and filing obligations for UAE businesses or foreign recipients of UAE sourced income.Withholding tax does not apply to transactions between UAE resident persons.
We offer following Corporate Tax Services,
- Corporate Tax Registration with the Federal Tax Authority
- Assessing and advising on corporate tax impact on the company
- Advising on the possibility of tax grouping of the companies to avail tax benefits
- Advising on the restructuring of group companies to avail tax benefits
- Computing the corporate taxable income after deducting applicable deductions and excluding the exempt income.
- Preparation and filing of the Corporate Tax returns
- Deregistration of Tax Registration Number
- Preparation of filing of tax documents for submission to FTA.
- Representing, replying and filing an appeal against the notice issued by the FTA.
- Represent the businesses to appeal against any penalties or notices issued by the FTA
Hallerbos has a team of highly qualified Chartered Accountants and tax advisors in the UAE who can help the companies to ensure tax compliance.
Contact us today for free consultation on corporate tax matters.
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