Mac & Ross Chartered Accountants

The UAE Federal Tax Authority (FTA) has reminded all businesses of their obligation to file corporate tax returns within nine months of the end of their financial year. This requirement applies to all taxable persons, including those exempt but still required to register, in line with UAE corporate tax regulations.

The FTA has stressed that filing early is strongly encouraged, as waiting until the deadline may lead to delays or penalties. Corporate tax payments should also be made ahead of time to ensure funds are processed successfully. Late or last-minute electronic transfers may not be cleared instantly by banks, potentially resulting in overdue payment fines.

Businesses are urged to carefully review their tax periods, confirm filing deadlines, and submit both returns and payments through the EmaraTax digital platform, which provides round-the-clock access and the latest updates. Importantly, the FTA clarified that filing and payment do not need to be completed simultaneously, provided both are completed within the set timeframe.

For companies with a financial year ending on 31 December 2024, tax return filing is already open via EmaraTax. Payments should also be settled well before the 30 September 2025 deadline, allowing sufficient time for processing.

The UAE Federal Tax Authority (FTA) is urging all Corporate Tax taxpayers to finalise their financial records, submit returns, and settle any due taxes within the specified deadlines to avoid penalties.

According to the FTA, all registered taxpayers – including entities with exempt status – are required to file their Corporate Tax returns (or annual declarations) and pay any applicable tax within nine months from the end of their tax period.

Importance of Timely Filing

Businesses are advised to prepare supporting documents in advance, such as trade licences, financial statements, and details of business activities, to ensure accurate and timely submissions.

Compliance is Key

Gain actionable insights to ensure compliance, optimize reporting, and prepare for changes impacting employee benefits.

Webinar Agenda: - Regulatory Requirements: EOSB / Gratuity compliance essentials. - Why Actuarial Valuation Matters: Understanding its necessity and benefits. - Why Compliance is Crucial: Adhering to IAS 19 Employee Benefits and Corporate Tax Reporting. - Key Assumptions: Analysis and impact of actuarial valuation assumptions. - Audit Considerations: General checkpoints and auditor FAQs. - Report Insights: A guide to interpreting actuarial valuation reports. - Open Forum: Interactive Q&A session with experts.

Webinar Date & Time - May 21 2025, 04:00 PM

The UAE Ministry of Finance and the Federal Tax Authority have launched a new initiative to waive administrative penalties for businesses and certain exempt persons who failed to register for Corporate Tax within the required timeframe.

This initiative has been formalized through a Cabinet Decision (to be issued soon) and is aimed at promoting early and voluntary tax compliance in the first year of corporate tax implementation.

Eligibility Criteria:

To qualify for the penalty waiver:

The taxpayer (or certain exempt person) must file the Corporate Tax return or annual statement within 7 months from the end of their first tax period as prescribed under the Corporate Tax Law.

Additional Clarifications:

Refund of Collected Penalties:

The FTA has confirmed that administrative penalties already collected will be refunded to eligible taxpayers who meet the criteria.

Purpose of the Initiative:

To encourage voluntary and timely compliance

To ease the financial burden on businesses

To support businesses during the transition to the new tax regime

To reinforce the UAE’s commitment to a competitive, business-friendly tax environment

Recommended Actions for Businesses:

Review your Corporate Tax registration status immediately

If not registered, initiate and complete the registration process without delay

Mac & Ross Chartered Accountants and Kandoi & Co Actuarial Advisors are proud to announce their Memorandum of Understanding (MOU) to provide specialized Actuarial Services in the UAE.

🔹 Expertise in Employee Benefits Actuarial Services ✔ End-of-Service Benefit (EOSB) Valuations ✔ Share-Based Payment Calculations ✔ Compliance with International Financial Reporting Standards (IAS 19, IFRS 2, IFRS 17)

🔹 IFRS 17 Reporting and Review for Insurance Companies

This collaboration ensures precise actuarial insights, regulatory compliance, and optimized financial strategies for businesses across the UAE.

Join us in celebrating this milestone as we redefine actuarial excellence in the region!

The UAE Ministry of Finance has issued Ministerial Decision No. 88 of 2025, formally adopting the OECD Commentary and Administrative Guidance on the Global Anti-Base Erosion (GloBE) Model Rules (Pillar Two) for the application of Cabinet Decision No. 142 of 2024 concerning the imposition of Top-Up Tax on Multinational Enterprises (MNEs).

This step is a critical alignment of the UAE’s domestic implementation of the OECD/G20 BEPS Pillar Two framework aimed at introducing a global minimum tax of 15% on MNE groups with consolidated revenues of EUR 750 million or more.

Key Highlights

The Decision formally adopts and incorporates by reference several key OECD publications as guidance for applying the UAE’s Top-Up Tax rules, including:

The 2024 Consolidated OECD Commentary on the GloBE Rules;

OECD’s Administrative Guidance (2024 and 2025 editions), covering provisions under Articles 8.1.4 & 8.1.5 (pertaining to filing obligations), 9.1 (pertaining to tax attributes upon transition i.e. deferred tax assets), and the GloBE Information Return; and

The Central Record of Administrative Guidance consolidating interpretations under the GloBE framework.

The Decision ensures consistent interpretation and application of Top-Up Tax provisions by UAE MNE groups and authorities in line with international standards.

What this means for UAE MNEs

MNE Groups in scope of Cabinet Decision 142 of 2024 must ensure their corporate structures, effective tax rate calculations and compliance framework aligns with the latest OECD administrative guidance;

The inclusion of OECD's GloBE Information Return guidelines (Jan 2025) indicates the likely standardized reporting obligations that UAE-headquartered MNEs will need to prepare for; and

MNEs should stay updated on how these administrative clarifications affect local Top-Up Tax calculations, exemptions, exclusions and transitional provisions.

Effective Date

Dubai has introduced a new resolution allowing free zone businesses to operate in mainland Dubai, creating fresh opportunities for growth.

Sheikh Hamdan bin Mohammed bin Rashid Al Maktoum, Crown Prince of Dubai, has issued a regulation permitting free zone establishments—excluding DIFC financial institutions—to operate outside their zones with Dubai Department of Economy and Tourism (DET) approval.

Key Benefits

Mainland Access: Free zone companies can now serve a wider customer base.

Flexible Licensing: Businesses can obtain DET permits for branches or specific activities.

Economic Growth: Encourages innovation, job creation, and a dynamic business environment.

Compliance: Separate financial records and adherence to all regulations are required.

Implementation

DET will release a list of permitted activities within six months. Existing businesses must comply within a year, with an optional one-year extension upon approval.

Recently, the UAE's Federal Tax Authority (FTA) issued Decision No. 1 of 2025, detailing circumstances under which extensions may be granted or rejected for submitting Tax Assessment Review Requests or Reconsideration Requests. This decision provides clarity for taxpayers unable to meet standard deadlines due to valid reasons. The said decision is effective from 1 March 2025.

Extensions may be granted in specific cases including:

• Accident or serious illness or death of the authorized signatory including legal representative or any of his close family members;

• Temporary business disruption beyond person’s control;

• Damage of records due to disaster;

• Malfunction in authority’s systems;

• Sudden discontinuation of business or business records due to installation of new system;

• Authority’s request for additional documents, where the taxpayer can prove the inability to obtain such documents within legally prescribed deadlines

Cases where extensions will be rejected:

• Lack of awareness by the taxpayer;

• Delays caused on account of negligence by third parties such as – Tax Agents, Legal Representatives, on whom taxpayers relied upon;

• Delay on account of complexity of the request;

• Applicant was busy running their business

This decision underscores the FTA's commitment to ensuring fairness and flexibility in the tax assessment and dispute resolution process, accommodating taxpayers facing genuine challenges in meeting procedural deadlines.

The UAE’s Federal Tax Authority (FTA) has called on all natural persons who are subject to Corporate Tax to complete their tax registration by March 31, 2025, to avoid administrative penalties.

To enhance awareness, the FTA had previously released the Corporate Tax Registration Guide for Natural Persons (CTGRNP1), outlining the registration process and requirements for individuals conducting business activities in the UAE.

Definition of a Natural Person

According to the FTA, a ‘natural person’ refers to any living human being, regardless of age or residency status. Individuals become liable for Corporate Tax if they engage in business activities within the UAE, including operating as sole establishments or as individual partners in Unincorporated Partnerships conducting business in the country.

Tax Registration Requirements

The FTA has clarified that a natural person engaged in business or business activities in the UAE during 2024 or later years must register for Corporate Tax if their total turnover in a calendar year exceeds AED 1 million. The deadline for registration is March 31 of the following year after surpassing this threshold, and registered individuals must comply with all Corporate Tax obligations.

Example of Tax Registration Deadline

For instance, if an individual conducting business in the UAE exceeds AED 1 million in revenue by July 31, 2024, they must submit their Corporate Tax registration application no later than March 31, 2025. Additionally, they are required to file their Corporate Tax Return by September 30, 2025.

Consequences of Non-Compliance

Failure to register for Corporate Tax by the specified deadline will result in an Administrative Penalty of AED 10,000. The FTA urges all affected individuals to review the relevant Corporate Tax legislation, guidelines, and awareness materials available on its official website to ensure compliance.

The Gulf Cooperation Council (GCC) is undergoing a transformative fiscal shift, marking the region's most significant economic change since its inception. Once known for its zero-tax regimes that attracted global corporations, the GCC is now embracing a new era of transparency and fair taxation under global initiatives.

Tax Reforms Aligned with Global Standards

A global minimum corporate tax rate of 15%, spearheaded by the OECD and adopted by over 140 nations, is reshaping the tax landscape. This measure aims to curb profit-shifting practices by mandating that multinational enterprises (MNEs) with global revenues exceeding EUR 750 million over two of the last four years adhere to a minimum tax rate, regardless of their operational location.

For instance, corporations operating across London, Dubai, and Manama can no longer exploit low-tax jurisdictions to reduce their overall tax liabilities. This shift enhances global transparency and accountability.

Regional Adaptations and Responses

The UAE took the lead in June 2023 by introducing a 9% corporate tax for businesses with profits exceeding AED 375,000 while maintaining incentives such as SME exemptions for turnovers under AED 3 million and free zone relief at 0% tax rates. These measures balance compliance with global standards while safeguarding the UAE's competitive edge as a business hub.

Other GCC nations are following suit:

Kuwait: A 15% tax rate aligned with global standards.

Qatar: Maintains a 10% rate while preparing for global minimum tax reforms.

Bahrain: Set to implement new tax regulations by 2025.

Saudi Arabia and Oman: Expected to introduce similar measures, reinforcing regional cohesion.

The phased implementation of Value Added Tax (VAT) since 2018 has also gained traction, with Bahrain and Saudi Arabia increasing their rates to 10% and 15%, respectively.

Shaping the Future: Economic Resilience and Digital Transformation

Evidence suggests that well-structured tax systems boost economic growth by fostering employment, encouraging business expansion, and attracting investments. Additional revenues are funneled into critical infrastructure and public services.

The GCC’s zero personal income tax policy remains a competitive advantage, especially for high earners, setting the region apart from hubs where personal tax rates exceed 20%. This approach continues to draw global talent.

Digital innovation is another cornerstone of this transformation. Saudi Arabia’s shift to e-invoicing has set the stage, with the UAE set to mandate e-invoicing for B2B and B2G transactions by 2026. This initiative reduces fraud, enhances transparency, and modernises business practices, benefiting both SMEs and larger corporations.

Long-term Vision

Although businesses may experience short-term impacts on profitability, the GCC’s overarching vision is clear: creating a diversified, resilient, and technologically advanced economy that attracts quality investments and talent. The integration of corporate taxes, global minimum tax laws, and digital tax administration solidifies the GCC's position as a global economic powerhouse.

The Saudi Ministry of Commerce and Industry has announced that all companies operating in the Kingdom must appoint licensed auditors by January 18, 2025. This new regulation is aimed at ensuring compliance with financial standards, improving transparency, and bolstering corporate governance across various industries.

The Ministry of Finance (MoF) has introduced the Financial Sustainability Standards Guide in the Federal Government at a meeting hosted at the Sustainability and Innovation Centre in Dubai. Representatives from the Ministry’s departments and federal entities participated in the event.

This initiative underscores the UAE’s commitment to embedding financial sustainability within the government sector, aligning public financial operations with the nation’s vision for sustainable development. The guide outlines core concepts and standards of government financial sustainability, emphasizing their importance and showcasing global best practices. It aims to ensure the long-term stability of financial resources, supporting the nation’s broader sustainable development goals.

Mariam Mohamed Al Amiri, Assistant Undersecretary of the Government Financial Management Sector at the Ministry of Finance, described the guide as a significant milestone in advancing sustainable development. “The Financial Sustainability Standards Guide in the Federal Government represents a qualitative leap in our efforts to achieve sustainable development. It provides an integrated framework for government entities to make financial decisions that enhance transparency and resource management efficiency, bolstering the resilience of our national economy for future generations,” she stated.

The launch event featured discussions on five central themes:

Embracing Sustainability: An Enduring Imperative for the UAE

Sustainability Frameworks and Initiatives in the UAE

The Importance of Sustainability in Government Finance and Operations

Overview of How to Develop Sustainability Guidelines

Integrating Sustainability into Functional Areas: Challenges and Opportunities

In the fast-paced UAE market, businesses must navigate evolving regulations and financial challenges. Audit and accounting services are essential for maintaining compliance, accuracy, and long-term growth.

The Importance of Audit Services in the UAE

Ensure Compliance: Stay aligned with local and international regulations.

Guarantee Accuracy: Validate financial statements for transparency.

Build Trust: Strengthen credibility with investors and stakeholders.

Accounting for Business Growth

Effective accounting practices are key for:

Managing Cash Flow: Prevent financial issues with proper records.

Tax Optimization: Minimize tax liabilities and stay compliant.

Supporting Growth: Accurate financial records help in better decision-making and strategic planning.

Why Choose Mac & Ross Chartered Accountants?

The UAE Federal Tax Authority (FTA) has announced a grace period for tax registrants who have fallen behind on updating their tax records, aiming to support businesses in maintaining compliance and avoiding penalties. The grace period applies from January 1, 2024, to March 31, 2025, providing an opportunity for businesses to adjust their tax records without incurring administrative penalties.

Under the new Cabinet Decision, registrants who faced penalties for not updating their information in the required timeframe and paid these fines between January 1, 2024, and the end of the grace period may be eligible for a refund. This aligns with Cabinet Decision No. (105) of 2021, which outlines the procedures for paying, waiving, and refunding administrative penalties.

The initiative encourages taxpayers to notify the FTA within 20 working days of any changes in their registered information, including business name, address, email, legal form, and activity listed in the commercial license. The FTA emphasized that prompt updates are crucial for regulatory compliance and noted that the penalty refund process will be managed in line with existing legislation.

Khalid Ali Al Bustani, Director General of the FTA, highlighted that the grace period aligns with the UAE’s commitment to a transparent and adaptable tax system, fostering a supportive environment for businesses. He encouraged registrants to use this period to update their records, reduce their tax burden, and contribute to the UAE's economic growth.

Comprehensive actuarial valuation services are essential for organizations seeking to manage their financial health and ensure compliance with regulatory standards. These services provide businesses with the insights necessary for effective decision-making regarding employee benefits, pensions, and corporate tax obligations.

Risk Management and Financial Planning

Actuarial valuation is integral to identifying future liabilities and understanding their financial impact. By leveraging data-driven insights, we help businesses:

Strategically Plan Reserves: Understand potential future liabilities associated with employee benefits, enabling effective planning for reserves and risk management.

Optimize Financial Health: Our expertise allows organizations to navigate complexities related to pensions and insurance, ensuring long-term financial stability.

Support for Tax Audits and Disputes

We act as a reliable partner during tax audits or disputes by providing:

Detailed Calculations: Comprehensive calculations and justifications for reported liabilities, ensuring transparency and compliance during audits.

Expert Support: Our experienced team is equipped to assist clients in addressing any questions or challenges arising from tax authorities.

Informed Decision-Making

Utilizing data-driven insights is essential for making smart decisions regarding employee benefits. Our services facilitate:

Strategic Decisions: By identifying potential liabilities, we empower businesses to make informed choices about their employee benefits, aligning with corporate goals and financial strategies.

Enhanced Operational Efficiency: Understanding financial implications allows organizations to optimize their operations and resources effectively.

Optimization of Tax Deductions

Actuarial valuation also focuses on optimizing corporate tax liabilities:

Insights into Deductible Expenses: We provide insights into employee benefit expenses that are deductible, enabling businesses to optimize taxable profits and minimize corporate tax liabilities.

Financial Benefits: Properly managing these deductions can significantly enhance a company's overall financial position.

Essential Compliance for Corporate Tax

Adhering to international and local standards is crucial for seamless corporate tax reporting:

Compliance with IAS 19, ASC 715, and Other Standards: We ensure that your organization meets the necessary legal standards for reporting employee benefits, minimizing compliance risks and enhancing financial integrity.

At Mac & Ross Chartered Accountants L.L.C., our actuarial valuation services are designed to ensure your financial health. Our team is dedicated to helping your business navigate the complexities of employee benefits, pensions, and corporate tax obligations effectively.

The Federal Tax Authority (FTA) and the Dubai Land Department (DLD) have bolstered their strategic partnership to introduce innovative digital solutions aimed at improving the user experience for real estate transactions in Dubai. This collaboration ensures compliance with tax regulations and facilitates efficient handling of VAT on real estate and commercial land sales.

The first phase of the initiative has been successfully completed through electronic data-sharing systems, with further advancements to be unveiled in the near future. The partnership was officially announced during GITEX Global 2024 at the Dubai World Trade Centre.

The collaboration focuses on integrating procedures related to VAT compliance, service classification, property categorisation, and the identification of transaction parties. By aligning real estate processes with the FTA's electronic systems, the initiative aims to create a streamlined mechanism for ensuring tax compliance in real estate transactions.

Khalid Ali Al Bustani, Director-General of the FTA, highlighted the importance of this partnership in delivering seamless digital services and enhancing governance and transparency. "This joint collaboration supports a regulatory environment that encourages self-compliance through clear and efficient digital processes, aligning with our broader goal of expanding digital transformation across all FTA services,” Al Bustani said.

Marwan Ahmed bin Ghalita, Director-General of the DLD, stressed the significance of the partnership in advancing Dubai’s digital transformation. He stated, "Through this collaboration, we aim to enhance tax compliance in the real estate sector by integrating our digital systems, thereby simplifying procedures and enhancing transparency in line with the aspirations of our leadership."

This partnership also aims to foster a tax culture within the real estate sector through data-sharing initiatives, awareness campaigns, and the introduction of procedures linked to tax processes. The collaboration outlines plans for joint training sessions, idea exchanges, and the execution of projects that align with the strategic goals of both entities.

Major Relief for UAE Businesses as ESR Filings Are Waived Under New Corporate Tax Framework

In a significant development for businesses in the UAE, particularly multinationals, authorities have announced that Economic Substance Rules (ESR) filings will no longer be required. This shift comes as the UAE has implemented a full corporate tax structure, rendering the previous ESR framework redundant.

Previously, companies engaged in nine ‘relevant activities’—including banking, insurance, shipping, lease finance, investment fund management, and holding companies—were obligated to file ESR reports to prove their ‘adequate economic presence’ in the UAE. Failure to do so resulted in hefty penalties, ranging from Dh20,000 for missed notifications to Dh50,000 for not submitting economic substance reports.

However, with the introduction of corporate tax (CT) rules, which include a 15% minimum tax on global multinational corporations (MNCs), the ESR compliance requirements have been absorbed into the broader corporate tax framework. This means businesses no longer need to file notifications, prove economic substance through office space, staff, or board presence, or submit audit reports at the end of the year.