The United Arab Emirates (UAE) has implemented a Corporate Tax regime for non-resident individuals and entities, subjecting them to taxation based on specific criteria for their presence and income sourced within the UAE.

The UAE’s corporate tax regime offers tax exemptions on dividends and participation interests to prevent double taxation, with specific criteria and tests to ensure eligibility.

Ministerial Decision No. 97 of 2023 details the requirements for maintaining Transfer Pricing Documentation under the UAE’s new Corporate Tax Regime, specifying conditions for Master and Local File maintenance and clarifying the inclusion of Related and Connected Persons.

The Small Business Relief in the UAE Corporate Tax regime offers eligible businesses with revenues below AED 3,000,000 simplified tax return procedures and exemption from Corporate Tax.

The Federal Decree Law No. 47 of 2022 outlines provisions for interest expenditure deductions, allowing up to 30% of the EBITDA with exceptions for net interest below AED 12 million, specific rules for related party transactions, and exceptions if no corporate tax advantage is sought.

Unincorporated partnerships in the UAE are flexible entities without separate legal personalities, subject to unique tax treatments where partners are taxed individually on their share of income, and can opt for corporate taxable status, while needing to align with UAE’s Commercial Companies Law for specific commercial activities.

The Federal Decree Law No. 47 of 2022 in the UAE necessitates that Taxable Persons adhere to IFRS, placing heightened importance on IAS 12 for effective tax accounting and compliance.