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.

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.

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.