Country Trading Profiles United Arab Emirates - Taxes

Tax Rates

Nature of the tax: Implementation of VAT is under process.
Tax rate: The Cooperation Council for the Arab States of the Gulf (CCASG) is considering the introduction of GCC wide value-added-tax (VAT) of 5% shall be inforced soon. Discussions have already seen the six member states - including the EAU - set a deadline of 2012 for its introduction.

corporate tax (exception of oil and gas companies and subsidiaries of foreign banks)	0%. There are no taxes levied by the Federal Government on income or wealth of companies and individuals.
Tax applicable for all companies: the duty deducted by the municipality in each Emirate at the time of issuance or renewal of a trade licence.	10% of the annual amount of the rent of offices and warehouses and 5% of the annual amount paid by a company to accommodate its employees.
For oil and gas companies or foreign bank subsidiaries having an income between 1,000,000 dirhams and 2,000,000 dirhams	10%
The same type of company having an income between 2,000,000 dirhams and 3,000,000 dirhams	20%
The same type of company having an income between 3,000,000 dirhams and 4,000,000 dirhams	30%
The same type of company having an income between 4,000,000 dirhams and 5,000,000 dirhams	40%
The same type of company having an income higher than 5,000,000 dirhams	55%

Tax rate for foreign companies: There is no difference between the residents and non-residents as far as taxation is concerned.
Capital gains taxation: None.
Main allowable deductions and tax credit: None
Other corporate taxes: None

Individuals are not taxed in UAE.	0%
There is however a property tax for the property owners.	between 2 and 15% of the property price based on the Emirate and the owner's profession.
Dubai emirate also imposes a rent tax.	5% of the annual rent for the lessors.
Municipalities also impose tax on services. It is deducted on the services of restaurants and hotels.	varies from Emirate to Emirate: 10% in Dubai; 16% in Abu Dhabi.
Real property tax	A transfer charge of 2% is levied on the transfer of real estate in the UAE (saller paying 0.5% and buyers 1.5%).

Countries with whom a double taxation treaty have been signed: Annexure of countries which have signed a double-taxation treaty with the Emirates (page 14).; Double Taxation Agreements signed by UAE
Withholding taxes: No Whithholding taxes are imposed by the federal government of the United Arab Emirates.
Bilateral agreement

Tax Authorities: Dubai Customs; Sharjah customs; Abu Dhabi customs
Other domestic resources: Datamix Group. Provider of technical and business knowledge in the region.

Tax year: From 1st January to 31st December.
Accounting standards: The accounting rules are still not very developed but the government to trying for the convergence of national practices towards international standards IAS/IFRS. There is no Accounting code in Emirates.
Accounting regulation bodies: UAE Ministry of Economy
Accounting reports: Companies should provide to the Ministry of Finance (trading companies) or to the Ministry of Industry (industrial companies) an annual activity report audited by an auditor. This obligation is only meant for renewal of the company's licence. In fact, no organisation double-checks the accounts.
Publication requirements: The companies listed on the stock exchange should submit their accounts to the "Emirates securities and commodities market authority" which imposes quarterly publication of balance sheets and income statements and an annual audited income statement.
Professional accountancy bodies: ALLOITT GROUP in the region
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Certification and auditing: Financial Statements must be prepared annually. The State Audit Institution of United Arab Emirates is one of the main audit organisation in the country.
Accounting news: EIN News - Middle East Accounting News