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operations for each country.
Conclusion:
UAE has attracted all the
leading organizations over the
past couple of decades. New
Generation companies and hi-
tech companies are not any
exceptions as they are also
attracted towards UAE. More
than 150 nationalities are living
in harmony and the population
has been steadily growing and
hitting close to 10 Million.
The Foreign Direct Investments
in UAE has also been growing
over the years due to the
strategic location and business-
friendly environment. This
The emirate-wise reporting of to file an Annual Return by 31st unique positioning of the UAE
the Standard Rated Supplies December 2020. will continue to make it “an
also ensures that the volume attractive” destination for both
of transactions and true size of The Ministry of Finance will businesses and tourists. This
economy is captured at each soon launch a central portal for country is the most “livable
Emirate level with accuracy. The the electronic submission of all and lovable” country in the
impact of VAT on a common man Economic Substance Returns world. The new regulations and
ranges between 1.5% to 5% as before the first financial period economic initiatives of recent
there is uniform rate of taxation deadline of 31st December 2020. times only goes to strengthen the
of 5% on all goods and services. CbCR Rules: country as a premier destinations
for business houses.
Economic Substance The Organization for Economic
Regulation : Cooperation and Development The entire nation is being led in
The UAE Government moved (OECD) as part of the initiative to the path of excellence and the
Prime Minister of the Country HH
quickly to bring in the Economic cub tax evasion and harmful tax Sheikh Mohammed bin Rashid
Substance Regulation which practices has recommended a Al Maktoum believes that “there
is being implemented during system of reporting transactions is no finish line in the race for
2020 whereby the details of all of Multi-National Entities. The excellence”.
the companies operating in the Country by Country Reporting
UAE whether in mainland or (CbCR) is a requirement which
Free Zones is being collected will help exchange of information
to check if the activities involve among different countries to
either shifting of the tax base or increase the transparency. A
parking of revenue as there is no Constituent Entity with annual
Income Tax in UAE for corporates. revenue in excess of AED 3.15
The review of the activities and billion is expected to report
the notification to the various the details of revenue, tangible
authorities is in progress. Once assets, number of employees,
the notifications are filed and profit before income tax, income
the clarity is obtained on the tax paid, capital, accumulated CA T P Anand
applicability of the ESR then earnings and all other relevant
the companies will be required information covering its
Disclaimer:
This article and/or write ups and/or any of its content shall not be treated as opinion and/or advice in any circumstances of the author(s) and/ or the Chapter. Reader’s to apply their best
judgement in the best interest of their requirement and should seek a formal opinion on any issue.
The Institute of Chartered Accountants of India (Dubai) Chapter NPIO TAX JOURNAL 2020 19
