Note: This blog is prepared on the basis of The UAE Corporate Tax Law and its relevant CD and MD is released by MOF. This is only for informative purposes and should not be used or relied upon to make individual or business decisions.
Small Business Relief for the Purposes of Federal Decree-Law no 47,MD-73-2023
- Taxable Person’s Revenue Threshold AED 3 million
- Tax periods commencing from on or after 1.6.2023 and ending on or before 31-12-2026
- A Taxable Person shall not be able to elect to apply the Small Business Relief if their Revenue in any relevant or previous Tax Period has exceeded the threshold set out in Clause 1 of this Article.
Exceptions
- Component of MNCs with turnover of AED 3.15 billion
- Qualifying Free Zone Person
- Tax loss in the relevant tax Period can not be carried forward
- Net interest expense can not be carried forward as well
- Anti avoidance rules applies if the Authority establishes that artificial separation of businesses
Conditions for Change in Tax Period-FTA decision no 5 2023
The change is for one of the following reasons:
- Aligning the Resident Taxable Person’s Financial Year with the Financial Year of another Resident Person for the purpose of forming a Tax Group or joining an existing Tax Group, or aligning the Taxable Person’s Financial Year with the Financial Year of its domestic or foreign head office, subsidiary, parent, or ultimate parent company
- There is valid commercial, economic, or legal reason to change the Tax Period.
- The Taxable Person’s liquidation.
- The Taxable Person has not yet filed the Tax Return for the Tax Period he is applying to change
- The application for change in Tax Period is in respect of any of following: a. Extend the current Tax Period to be a maximum of 18 months; or b. Shorten the next Tax Period to be between 6 and 12 months.
Provisions of Exemption from Corporate Tax in UAE -FTA Decision no 7-2023
Categories of Taxable Persons Required to Prepare and Maintain Audited Financial Statements –MD-82 2023
For the purposes of Clause 2 of Article 54 of the Corporate Tax Law, the following categories of Taxable Persons shall prepare and maintain audited financial statements:
1. A Taxable Person deriving Revenue exceeding AED 50,000,000 (fifty million United Arab Emirates dirhams) during the relevant Tax Period.
2. A Qualifying Free Zone Person.
Exception from Corporate Tax Registration in UAE –MD-43-2023
The following Persons shall not register for Corporate Tax with the Authority:
(a) A Government Entity.
(b) A Government Controlled Entity.
(c) A Person engaged in an Extractive Business that meets the conditions of Article 7 of the Corporate Tax Law in UAE.
(d) A Person engaged in a Non-Extractive Natural Resource Business, that meets the conditions of Article 8 of the Corporate Tax in UAE.
(e) A Non-Resident Person that derives only State Sourced Income under Article 13 of the Corporate Tax Law and that does not have a Permanent Establishment in the State according to the provisions of the Corporate Tax Law.
Paragraphs (a) to (d) of Clause (1) of this Article shall be without prejudice to the obligation of the Person to register for Corporate Tax in UAE in cases where the Person becomes a Taxable Person under the provisions of the Corporate Tax Law.
Requirements for Maintaining Transfer Pricing Documentation-MD-97-2023
Categories of Businesses or Business Activities Conducted by a Resident or Non-Resident Natural Person that are Subject to Corporate Tax in UAE-CD-49 2023
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