The largest Islamic bank in the UAE and the second-largest Islamic bank in the world said net operating revenues showed robust growth of 11 per cent YoY to Dh2.467 billion compared to Dh2.226 billion in the same 2021 period
Finance3 weeks ago
The UAE's Ministry of Finance on Monday announced the introduction of federal corporate tax on business profits for organisations that begin their first financial year on or after June 1, 2023.
Here are some of the important takeaways from the announcement by the Federal Tax Authorities:
The corporate tax will apply to all businesses and commercial activities alike, except for the extraction of natural resources which will remain subject to Emirate level corporate taxation.
A 0% tax rate will be applicable on taxable profits up to Dh375,000, in an attempt to support small businesses and startups.
No corporate tax will apply on personal income from employment, real estate and other investments, or on any other income earned by individuals that does not arise from a business or other form of commercial activity licensed or permitted to be undertaken in the UAE, according to WAM.
Given the position of the UAE as a global financial centre and international business hub, the UAE will not impose withholding taxes on domestic and cross border payments.
Foreign investors who do not carry on business in the UAE will not be subject to corporate tax.
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The UAE corporate tax regime will continue to honour the corporate tax incentives currently being offered to free zone businesses that comply with all regulatory requirements and that do not conduct business with mainland UAE.
The corporate tax has been set at a standard statutory tax rate of 9 per cent.
Businesses will only need to file one corporate tax return each financial year and will not be required to make advance tax payments or prepare provisional tax returns. Transfer pricing and documentation requirements will apply to UAE businesses with reference to the OECD Transfer Pricing Guidelines.
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