The need to prepare for the arrival of UAE corporate tax

The need to prepare for the arrival of UAE corporate tax

On January 31 2022, the UAE Ministry of Finance (MOF) announced the introduction of a corporate tax (CT) regime by publishing FAQ’s and later at the end of April 2022, released the Public Consultation Document (PDC) seeking inputs, on all possible aspects covering technical and other aspects, from the business community and other interested parties before rolling out UAE Government intention and expectation from CT. The FAQ’s published covered high level details on applicability (UAE businesses and commercial activities), effective date (businesses with the financial year starting on June 1 2023), CT rates (0 per cent, 9 per cent and 15 per cent*), exempt income (individual salary and other income earned in their personal capacity and dividends and capital gains earned by a UAE business subject to conditions), free zone business taxability, tax grouping, transfer pricing rules (on business transaction with foreign and domestic related parties) and the glimpse of administration. However, the PDC has thrown light on the important aspects including “taxable person” and “basis of taxation” that may be implemented with the introducing of final regulation to cover the taxability on the income of a natural person (where income generated from business or commercial activity in UAE would