Tag: UAE

Tax Registration and E-Invoicing in the UAE: A Comprehensive Guide for Businesses

The United Arab Emirates is rapidly modernizing its tax landscape, embracing digitalization to enhance transparency, streamline processes, and combat tax evasion. For businesses operating in or entering the UAE market, understanding and complying with the requirements for a Tax Registration Number (TRN) and the upcoming e-invoicing mandate is paramount.

This article provides a comprehensive overview of both processes, equipping businesses with the knowledge to navigate these crucial tax obligations.

Obtaining Your Tax Registration Number (TRN)

The Tax Registration Number (TRN), also often referred to as a Tax Identification Number (TIN) or VAT Identification Number, is a unique 15-digit code assigned by the Federal Tax Authority (FTA) to all VAT-registered businesses in the UAE. It is fundamental for all interactions with the FTA, including charging and reclaiming VAT, and is a prerequisite for the upcoming e-invoicing system.

Who Needs a TRN?

TRN is compulsory for:

Step-by-Step Guide to TRN Application via EmaraTax Portal:

The application for a TRN is done online through the FTA’s official EmaraTax portal.

  1. Sign Up on the EmaraTax Portal:
    • Visit the official EmaraTax website (tax.gov.ae).
    • Click “Sign Up” to create a new account, providing your email address and contact information. UAE Pass can also be used for quicker registration.
    • Verify your email through the link sent to you.
    • Once verified, log in to your account.
  2. Start the VAT Registration Application:
  3. Provide Business and Financial Details:
    • Fill in all required information accurately across the various sections, which typically include:
      • Applicant Details: Specify if you are registering as a legal or natural person, your trade license details (number, issue/expiry dates), and legal structure.
      • Contact Details: Your business address, email, and phone number.
      • Financial Details: Your turnover for the last 12 months and expected revenue for the next 30 days, along with supporting financial statements (e.g., income statement, invoices).
      • Banking Details: Your UAE bank account information, including IBAN and bank name, often requiring a stamped bank letter.
      • Ownership Details: For owners with 25% or more ownership, provide full name, nationality, Emirates ID/passport number, and ownership percentage. Upload supporting documents like passport copy, Emirates ID, or share certificates.
      • Authorized Signatory: Details of the person legally authorized to represent the business (e.g., Director, Partner), including their Emirates ID/passport copy and proof of authorization (e.g., Power of Attorney, MOA).
  4. Upload Required Documents:
    • Prepare scanned copies of all necessary documents in accepted formats (PDF, JPG, PNG) with a maximum file size of 2MB (or 5MB for some documents on the FTA portal). Common documents include:
      • Valid Trade License(s)
      • Passport and Emirates ID copies of the authorized signatory(s), owner(s), and manager.
      • Memorandum of Association (MoA) or Articles of Association (AoA)
      • Company bank account details (IBAN and stamped bank letter).
      • Turnover declaration for the specified periods, signed and stamped on company letterhead.
      • Supporting financial documents (e.g., invoices, LPOs, contracts).
      • Address proof (title deed or lease agreement).
      • Certificate of Incorporation (if applicable).
      • Customs details (if applicable).
  5. Review and Submit:

Post-Submission:

The FTA typically processes applications within 20 business days. Monitor your EmaraTax account and email for updates or requests for additional information. Upon approval, your TRN certificate will be issued and available in your EmaraTax account.

Embracing E-Invoicing in the UAE

The UAE is moving towards a mandatory e-invoicing system as part of its “e-billing system” project, aiming for a fully digital and transparent economy. This initiative will significantly impact how businesses generate, transmit, and store invoices.

What is E-Invoicing?

E-invoicing refers to the creation, submission, and storage of invoices in a digitally structured, machine-readable format that complies with government standards.28 This differs from unstructured digital invoices like PDFs or scanned documents. The UAE’s framework is based on the Peppol 5-corner model (Decentralized Continuous Transaction Control and Exchange – DCTCE) and will utilize Accredited Service Providers (ASPs).

Key Timelines and Scope:

  • Q2 2025: New rules and regulations for e-invoicing are expected to be published.
  • Q2 2026 (July 2026): Phase 1 of mandatory e-invoicing is expected to go live for B2B (Business-to-Business) and B2G (Business-to-Government) transactions.
  • B2C (Business-to-Consumer) transactions are likely to be included in later phases.
  • The system will apply to all taxpayers required to issue invoices under UAE law, with larger businesses expected to be the first to adopt.
  • VAT groups will also need to comply, with each member connecting to an ASP while using the group’s TRN.

How E-Invoicing Will Work (Peppol 5-Corner Model):

  1. Supplier Initiates: The supplier generates invoice data in their ERP or invoicing system.
  2. Transmission via Sending ASP: The supplier sends the invoice data to their chosen FTA-accredited Service Provider (ASP).
  3. ASP Validation and Conversion: The sending ASP validates the invoice data to ensure it meets UAE VAT regulations and converts it into the required structured digital format (e.g., UAE standard PINT AE XML).
  4. Secure Transmission (Peppol Network): The validated invoice is securely transmitted over the OpenPeppol network to the buyer’s ASP.
  5. Buyer Receives via Receiving ASP: The receiving ASP collects and delivers the invoice data to the buyer’s system, automatically populating their accounting software.
  6. FTA Reporting: The sending ASP also transmits an extract of relevant invoice data in real-time to the Federal Tax Authority (FTA) for tax compliance and audit purposes. The FTA acts as a repository and does not pre-clear invoices.

Mandatory E-Invoice Fields:

Compliant e-invoices must include all mandatory fields as per UAE VAT regulations, such as:

  • Supplier details (business name, address, TRN).
  • Buyer details (name, address, TRN, if applicable for B2B/B2G).
  • Unique, sequential Invoice Number and Date.
  • Description of goods/services, quantity, and unit price.
  • VAT breakdown (VAT rate applied, VAT amount).
  • Currency and total amount.
  • QR Code (if applicable, for enhanced validation).40

Preparing Your Business for E-Invoicing:

Businesses should start preparing now to ensure a smooth transition:

  1. Understand Regulations: Stay updated on FTA regulations and new compliance deadlines.
  2. Assess Current Processes: Review your existing invoicing processes to identify gaps and areas that need adjustment for e-invoicing.41 Manual invoicing will require significant changes.
  3. Choose an Accredited Service Provider (ASP): Select an FTA-accredited e-invoicing system or software that supports structured digital invoicing (XML, UBL, Peppol), validates data, transmits electronically, and securely stores invoices for at least five years.
  4. Upgrade Technology & Integrate Systems: Invest in a robust digital infrastructure.42 Your e-invoicing system must integrate seamlessly with your existing ERP, accounting software, and procurement tools.43
  5. Train Your Teams: Educate employees across finance, tax, IT, sales, and procurement on the new e-invoicing processes to ensure error-free compliance.44
  6. Data Security: Ensure your systems meet data security requirements and are capable of digital signatures/electronic signatures for authenticity and integrity.45

Conclusion

Applying for a TRN and preparing for e-invoicing are critical steps for any business operating in the UAE.46 While obtaining a TRN is already a mandatory requirement for VAT-registered entities, the e-invoicing mandate signifies a significant shift towards a fully digital tax ecosystem.47 By proactively understanding the requirements, leveraging the EmaraTax portal, and engaging with accredited service providers, businesses can ensure compliance, enhance operational efficiency, and contribute to the UAE’s vision of a modern, transparent digital economy. Staying informed and preparing in advance will be key to a successful transition.

UAE  issued a new corporate Tax Rule–Know what changes have been made

UAE Cabinet Focuses on Economy, Sports, and Environment

UAE  issued a new corporate Tax Rule–Know what changes have been made:

The UAE has taken a new ministerial decision in order to maintain the transparency and consistency of corporate tax regimes. This new ministerial decision will impact every business that operates in the UAE, especially the tax groups and qualifying free zone entities.

What is New Corporate Tax Rule?

As per this new rule issued by Minsitary of Finance of the UAE on 14th April 2025, all tax groups have to ready the audited special-purpose aggregated financial statements.

However, the individual members of these groups won’t need to provide separate audited financial statements, significantly easing the compliance requirements. This move by the UAE shows that the UAE is a business-friendly place with clear rules that promote transparency without being too strict.

Objectives:

  • Promoting Corporate Tax transparency
  • Aligning with global minimum tax efforts like OECD Pillar 
  • Stopping tax evasion by multinational firms and providing clear guidelines in free zones.
  • Easing the compliance load for businesses.

Which businesses does this rule affect?

Under this new decision, the following entities are included: 

  • Tax Groups, which consist of multiple related companies filing a tax return together
  • Qualifying Free Zone Persons, specifically those distributing goods or materials in Designated Zones.

The FTA (Federal Tax Authority) will issue detailed guidelines to ensure these businesses can clearly benefit from corporate tax exemptions.


Key Provisions

ProvisionDetails
Audited Financial StatementsTax groups need to be presented in aggregated form only
Standalone Audit RequirementIndividual members will not have to do this
Special Purpose AggregationOnly for Corporate Tax compliance
Free Zone ClarificationAdditional guidelines for goods distribution will come soon
FTA GuidanceDetailed framework is coming

Free Zone Distribution Rule:

Under this new decision, the following entities are included: Tax Groups, which consist of multiple related companies filing a tax return together, and Qualifying Free Zone Persons, specifically those distributing goods or materials in Designated Zones. The FTA (Federal Tax Authority) will issue detailed guidelines to ensure these businesses can clearly benefit from corporate tax exemptions.

Impact on Businesses – What will be the impact on business?

This new decision will directly impact several types of business structures. The major impacts are as follows:

Positive Impact

  • Policy clarity for Global MNEs
  • Certainty in Free Zones
  • Increased financial transparency.

Compliance and Reporting – What needs to be done?


Companies need to implement these steps:

  • Implement a financial reporting system for specific purposes
  •  Inform the tax team about updated guidelines
  • Follow the documentation framework issued by the FTA
  • Ensure a coordinated approach with auditors.
Parameter Existing ruleNew Rule (2025)
Audited Statements RequirementOptional or on case basisMandatory for tax groups
Free Zone ClarityAmbiguous for distributorsSpecific guidance on designated distribution
Individual Audit for Group MembersSometimes mandatoryNot required under new rule
Aggregated FinancialsNot standardizedSpecial-purpose format defined

Global Alignment – ​​Alignment with OECD and Pillar 2

The UAE is joining the global OECD Pillar 2 initiative, which sets a minimum tax of 15% for large multinational companies. They already have a 9% corporate tax, and this new decision aligns their tax system with those of developed countries like the OECD.

Conclusion: 

The new corporate tax decision in the UAE not only clarifies the compliance framework but also aligns it with the global taxation system. This will provide certainty for businesses in Free Zones and require Tax Groups to adopt a straightforward yet accurate financial reporting structure. The UAE has once again demonstrated its desire to be a progressive tax jurisdiction that values both compliance and simplicity.

Money Transfer Alert: UAE Expats Advised to Remit Amidst Rupee Volatility

Indian expats in the UAE are getting fewer rupees for their dirham when sending money home, a trend that could worsen due to new US tariffs. The rupee has strengthened against the dirham, moving from 23.94 on February 10, 2025, to 23.30-23.33 currently. Some analysts believe the rupee could strengthen further.

Currency exchange sources advise expats to remit money quickly, anticipating market volatility from the US tariffs. These tariffs are causing global market uncertainty, potentially weakening the rupee to 23.55-23.60 levels.

Monitoring the dollar index is crucial, as its decline could indicate further strengthening of other currencies. While the dollar previously hit record highs against the rupee, it has since weakened, suggesting a potential base formation. The rupee is expected to remain volatile due to global trade tensions.

Analysts note that the dollar’s dominance is threatened by unpredictable US policies, leading to investor nervousness and a potential loss of trust. The dollar index’s recent decline reflects these concerns.

UAE’s Latest VAT Amendments: Key Changes Explained

UAE: Public clarification issued on VAT amendments

The Emirati Federal Tax Authority (FTA) released Public Clarification No. VATP040, providing details on recent amendments to the Executive Regulation of Federal Decree-Law No. 8/2017. The clarification outlines changes to VAT regulations affecting registration, tax calculations, exemptions, and compliance requirements.

Key updates in the clarification:

  • VAT registration and deregistration: Updates to the rules governing mandatory and voluntary registration, as well as changes related to tax group registration, deregistration, and amendments.
  • Profit margin taxation: Amendments to provisions for accounting for tax on profit margins.
  • Zero-rated supplies: Clarifications on zero-rating rules for exported goods and services, international transportation of passengers and goods, and healthcare services.
  • Input tax adjustments: Revised input tax apportionment and adjustment rules under the capital assets regime.
  • Record-keeping requirements: Updates to compliance and documentation obligations for taxable entities.
  • Supply exceptions and tax deregistration: New provisions specifying supply exemptions and criteria for tax deregistration.

The clarification provides guidance to businesses on implementing the latest VAT amendments in accordance with the updated Executive Regulation.

UAE Welcomes More Indian Travelers with Expanded Visa-On-Arrival Program

UAE Expands Visa-On-Arrival Facility For Indians From 6 More Countries

The United Arab Emirates (UAE) has expanded its visa-on-arrival programme for Indian nationals by including travellers with valid visas, residence permits, or Green Cards from six more countries on the eligibility list. The move permits more Indian passport holders to access visa-on-arrival facilities at UAE entry points.

Under the Arab country’s latest order, Indians with valid visas, residence permits, or Green Cards from Singapore, Japan, South Korea, Australia, New Zealand, and Canada will be allowed access to the visa-on-arrival facility in the UAE. The Arab nation already had this policy for Indian nationals holding valid documentation from the United States, European Union member states, and the United Kingdom. 

Eligibility Criteria

To be eligible for the programme, Indian nationals must meet the criteria set by UAE, which include holding a valid ordinary passport with at least six months validity from the date of arrival. The travellers should also have a valid visa, residence permit, or Green Card from any of the eligible countries on the list.

If they meet these requirements, the individuals will be required to pay the visa fee upon arrival at UAE immigration checkpoints.

Visa Fees

The UAE has introduced three categories for eligible Indian travellers, with a nominal visa fee. For a 4-day visa, travellers will have to shell out Dh100 (approx. Rs 2,270), while for a 14-day extension, they will have to pay Dh250 (approx. Rs 5,670). There is also a 60-day visa, for which they will have to pay Dh250 (approx. Rs 5,670).

Motive Behind The Initiative

According to Major General Suhail Saeed Al Khaili, Director General of UAE’s Authority for Identity, Citizenship, Customs, and Port Security (ICP), the move of granting visas on arrival to Indian nationals from some countries aligns with the long-term strategic partnership between the Abu Dhabi and New Delhi.

The initiative aims to facilitate smoother travel for Indian citizens, offering them and their families new opportunities to explore life, residency, and employment prospects in the UAE, according to a report by the Gulf News.

Moreover, the initiative gives Indians an opportunity to experience UAE’s world-class tourism, economic landscape, and dynamic business environment while also attracting top global talent and entrepreneurs-further solidifying the UAE’s status as a global financial, tourism, and economic hub, ICP said.

New Petrol Prices in UAE for February 2025

The United Arab Emirates announced the fuel prices for February 2025 on Friday, January 31.

The Fuel Prices Monitoring Committee has increased the prices compared to those of January 2025.

The Ministry of Energy determines the approved fuel prices each month based on the average global oil price, adjusted for the operating costs of distribution companies.

These new rates will take effect from February 1 and are as follows:

Category

Price per litre (February)

  • Super 98 petrol: Dh2.74
  • Special 95 petrol: Dh2.63
  • E-plus 91 petrol: Dh2.55

Depending on the vehicle type, filling up your tank in February will cost you between Dh6.12 and Dh9.62 more than last month.

Here is a detailed cost analysis for filling your vehicle:

Compact Cars

Average fuel tank capacity: 51 litres

Category

Full Tank Cost (February)

  • Super 98 petrol: Dh139.74
  • Special 95 petrol: Dh134.13
  • E-plus 91 petrol: Dh130.05

Sedans

Average fuel tank capacity: 62 litres

Category

Full Tank Cost (February)

  • Super 98 petrol: Dh169.88
  • Special 95 petrol: Dh163.06
  • E-plus 91 petrol: Dh158.1

SUVs

Average fuel tank capacity: 74 litres

Category

Full Tank Cost (February)

  • Super 98 petrol: Dh202.76
  • Special 95 petrol: Dh194.62
  • E-plus 91 petrol: Dh188.7

BASICS OF TAXES IN UAE 2025

The UAE has a relatively simple tax system compared to many other countries. Here’s a breakdown of the main taxes:

1. Value Added Tax (VAT)

  • What it is: A 5% consumption tax on most goods and services.
  • Who pays: Consumers ultimately bear the cost, but businesses collect and remit it to the government.
  • Exemptions: Some essential items like basic food, healthcare, and education are exempt.

You’re smart to stay updated on VAT! The UAE has been actively refining its VAT system. Here’s a summary of the latest, combining the initial framework with the November 2024 amendments:

Key Updates (effective November 15, 2024):

  • Export of Goods: Documentation requirements for 0% VAT are simplified. You now need either a customs declaration with commercial evidence OR a transport document with a tax invoice and payment confirmation.
  • Export of Services: Stricter conditions for 0% VAT. Services must not be performed in the UAE or specified zones. Real estate, telecom, and electronic services have narrower definitions.
  • Financial Services: New exemptions, including management of investment funds and services related to virtual assets (cryptocurrencies). This applies retroactively from January 1, 2018.
  • Composite Supplies: Clearer rules for transactions involving a mix of goods and services. When there’s no dominant element, VAT is based on the overall nature of the supply.
  • Employee Medical Insurance: Businesses can now recover VAT on medical insurance for employees and their dependents (spouse and up to three children under 18).
  • Deemed Supplies: Updated thresholds: AED 500 for goods, AED 250,000 output tax for government entities/charities.
  • VAT Refund for Tourists: A new system allows tourists to claim VAT refunds on e-commerce purchases made during their stay.

Core Framework (still in place):

  • Standard Rate: 5%
  • Zero-Rated Supplies: Exports, certain education and healthcare services, etc.
  • Exempt Supplies: Residential properties, undeveloped land, etc.
  • Registration: Mandatory for businesses exceeding the threshold (AED 375,000).
  • Returns: Filed quarterly.
  • Penalties: For non-compliance.

Important Notes:

  • Businesses must adapt to these changes and ensure compliance.
  • The amendments aim to clarify certain aspects, support specific sectors, and improve efficiency.
  • It’s crucial to review the updated VAT legislation and seek professional advice if needed.

Where to Stay Updated:

By staying informed, businesses can navigate the UAE’s VAT system effectively and optimize their tax positions.

2. Corporate Tax

  • What it is: A tax on business profits.
  • Rate: 0% for taxable income up to AED 375,000, and 9% for income exceeding that threshold.
  • Who pays: Businesses with taxable income.
  • Exemptions: Some businesses, like those in free zones, might be exempt.

You’re right to ask for an update! The UAE’s corporate tax regime is still relatively new, and they’ve made some recent changes. Here’s a summary of the latest, combining the initial framework with the December 2024 amendments:

Key Updates:

  • Domestic Minimum Top-up Tax (DMTT): Effective for financial years starting on or after January 1, 2025. This aligns the UAE with the OECD’s global minimum tax rate of 15% for large multinational enterprises (MNEs). It applies to MNEs with consolidated global revenues of €750 million or more in at least two of the four preceding financial years.
  • Tax Incentives: The Ministry of Finance is considering introducing incentives to support growth and innovation:
    • Research and Development (R&D) Tax Incentive: Potentially effective for tax periods starting on or after January 1, 2026. This could provide a 30-50% tax credit (potentially refundable) for qualifying R&D activities conducted within the UAE.
    • Refundable Tax Credit for High-Value Employment: Potentially effective from January 1, 2025. This would offer a tax credit as a percentage of eligible salary costs for employees in high-value roles (e.g., C-suite executives) contributing significantly to the UAE economy.

Core Framework (still in place):

  • Standard Rates:
    • 0% for taxable income up to AED 375,000
    • 9% for taxable income above AED 375,000
  • Scope: Applies to businesses and individuals with a commercial license, including free zone businesses (with potential exemptions).
  • Exemptions: Extraction of natural resources, dividends from qualifying shareholdings, capital gains, qualifying intra-group transactions, and certain free zone businesses.
  • Administration: Handled by the Federal Tax Authority (FTA).

Important Notes:

  • The DMTT and incentives are subject to legislative approvals and further guidance from the Ministry of Finance.
  • Businesses should stay informed about the latest developments and assess how these changes impact their tax positions.

Where to Stay Updated:

It’s always recommended to consult with tax professionals for personalized advice. The UAE’s corporate tax landscape is evolving, so staying current is essential for businesses operating there.

3. Excise Tax

  • What it is: A tax on specific goods deemed harmful to health or the environment.
  • Items taxed: Carbonated drinks, energy drinks, tobacco products.
  • Rates: Vary depending on the product.

The UAE introduced excise tax in 2017 to discourage the consumption of goods deemed harmful to health or the environment.1 This tax applies to specific products and is levied at the point of production or import.2

Excise Tax Rates:

  • Carbonated drinks: 50%3
  • Energy drinks: 100%4
  • Tobacco products: 100%5
  • Electronic smoking devices and liquids: 100%6
  • Sweetened drinks: 50%7

Key points about excise tax in the UAE:

  • Purpose: To reduce consumption of harmful goods and generate government revenue.8
  • Scope: Limited to specific products.9
  • Tax point: Levied once at production or import.10
  • Registration: Businesses involved in the production, import, or stockpiling of excise goods must register with the Federal Tax Authority (FTA).11
  • Returns: Registered businesses must file monthly excise tax returns.12

Examples of excise goods:

  • Carbonated drinks: Sodas, fizzy drinks.13
  • Energy drinks: Red Bull, Monster.14
  • Tobacco products: Cigarettes, cigars, shisha.15
  • Electronic smoking devices: Vapes, e-cigarettes.16
  • Sweetened drinks: Juices with added sugar, flavored milk.

Excise tax vs. VAT:

While both are consumption taxes, excise tax differs from VAT in its scope and application.17 VAT is a broader tax applied to most goods and services at each stage of the supply chain, whereas excise tax is specific to certain harmful products and levied only once.18

For further information:

This information provides a general overview of excise tax in the UAE. For specific details and the latest regulations, it is always best to consult the official sources mentioned above.

4. Customs Duties

  • What it is: Taxes on goods imported into the UAE.
  • Rates: Vary depending on the type of goods.

The United Arab Emirates (UAE) imposes customs duties on most imported goods to protect its local industries and generate revenue.1 The general customs duty rate is 5% of the CIF (Cost, Insurance, and Freight) value of the goods.2 However, certain goods are subject to different duty rates, such as:

  • Alcohol: 50%3
  • Tobacco products: 100%4
  • Certain food items: 0% (e.g., livestock, meat, seafood, vegetables, fruits, coffee, tea, grains, and seeds)

Some goods are exempt from customs duties, including personal belongings, gifts, and certain types of machinery and equipment.5

You can find more information about customs duties in the UAE on the official websites of the customs authorities in each emirate, such as:

  • Federal Authority for Identity, Citizenship, Customs & Ports Security (ICP): [invalid URL removed]
  • Dubai Customs: https://www.dubaitrade.ae/
  • Sharjah Customs: [invalid URL removed]

It is important to note that customs regulations and duty rates can change, so it is always advisable to check with the relevant authorities for the latest information before importing goods into the UAE.

No Personal Income Tax

The UAE does not have a tax on personal income, making it an attractive destination for workers.om

Other Taxes

  • Some emirates may have local taxes like property or tourism taxes.
  • There is no inheritance tax at the federal level.

Important Notes:

  • Businesses must register for VAT if their turnover exceeds a certain threshold.
  • Tax laws and regulations can change, so it’s important to stay updated.
  • The Federal Tax Authority (FTA) is responsible for administering taxes in the UAE.

Where to Get More Information:

UAE Corporate Tax Registration Deadline Approaches for Individuals Generating Over Dh1 Million

UAE Corporate Tax: Registration Deadline for Individuals Earning Over Dh1 Million

Dubai: Individuals operating sole proprietorships must complete their corporate tax registration by March 31, 2025, as per the reminder from the Federal Tax Authority (FTA).

This requirement also extends to those who are partners in unincorporated partnerships.

The initial tax period for these individuals is determined by the calendar year. Those who generate over Dh1 million in revenue during 2024 qualify as a ‘taxable person’.

If the revenue exceeds the Dh1 million threshold in later years, these individuals are obligated to adhere to all corporate tax regulations.

According to the FTA, a ‘natural person’ is defined as someone who is either a UAE resident or is engaged in a business activity within the country.

For example, if an individual earns more than Dh1 million by July 31, 2024, they must submit their corporate tax registration application by the March 31, 2025 deadline and file their corporate tax return by September 30, 2025.

Be Aware of Penalties

Failure to register by the specified deadline will result in an administrative penalty of Dh10,000.

The FTA encourages all relevant parties to familiarize themselves with the Corporate Tax legislation, as well as the implementing decisions, guides, public clarifications, and awareness materials that are available on the FTA’s official website.

Registration can be performed through the EmaraTax platform. Additionally, the FTA has released the ‘Corporate Tax Registration – Taxpayer User Manual’, which provides comprehensive instructions for registering via EmaraTax.

New users can access the EmaraTax platform at eservices.tax.gov.ae, where they can create an account using their email address and phone number. After setting up their profile, individuals can select the corporate tax registration option to complete their application.

Alternatively, applications can also be submitted at Tas’heel centers.

UAE Implements New VAT Regulations for Gold and Diamond Traders

The United Arab Emirates (UAE) has announced new value-added tax (VAT) rules for registered gold and diamond dealers, aimed at boosting the sector’s growth and aligning with global best practices.

The Ministry of Finance (MoF) has issued Cabinet Decision No. (127) of 2024, extending the reverse charge mechanism to businesses trading in precious metals and stones.

Under the reverse charge rules, suppliers are no longer required to charge or collect VAT from registered customers. Instead, buyers are now responsible for calculating and reporting VAT in their tax returns.

Reverse charge mechanism coverage

  • Precious metals: Gold, silver, palladium, and platinum
  • Precious stones: Diamonds (natural and manufactured), pearls, rubies, sapphires, and emeralds.
  • Jewellery: Items made with these precious metals or stones, provided that the value of the precious metals or stones surpasses the value of other components.

This expansion is expected to strengthen the UAE’s position as a global hub for precious metals and stones trading.

The Ministry of Finance emphasized that the changes reflect its commitment to creating a robust regulatory framework that fosters corporate growth and innovation while staying aligned with international standards.

UAE Introduces Nationwide Health New Insurance Scheme for Private Sector Workers and Domestic Helpers

The United Arab Emirates (UAE) launched a fundamental health insurance scheme on Monday, December 16, aimed at private sector employees and domestic workers nationwide who currently lack insurance coverage.

According to the Ministry of Human Resources and Emiratisation (MoHRE), this initiative will take effect on January 1, 2025, for private sector workers in regions such as Sharjah, Ajman, Umm Al Quwain, Ras Al Khaimah, and Fujairah.

This health insurance scheme is already mandatory in Abu Dhabi and Dubai.

The program has been launched in collaboration with the Federal Authority for Identity, Citizenship, Customs, and Port Security (ICP), as well as the Ministry of Health and Prevention (MOHAP), following a Cabinet decision.

“The health insurance scheme demonstrates the UAE’s dedication to providing a comprehensive protection system to all workers in the labor market, ensuring a decent standard of living by facilitating access to high-quality healthcare services for private sector employees and domestic workers,” stated Khalil Al Khoori, the undersecretary of labor market and Emiratisation operations at MoHRE.

He further noted, “The new Health Insurance Scheme in the UAE is expected to significantly enhance the competitiveness of the country’s labor market, improving indicators related to quality of life, rights protection, and social and healthcare security.”

Key Information on the New Health Insurance Scheme

Who is eligible?

Employers are required to obtain a new health insurance policy as a condition for issuing or renewing residency permits.

However, this obligation does not pertain to employees with work permits issued before January 1, 2024, which remain valid. The requirement will only be enforced upon the renewal of their residency permits.

How to obtain it and the cost?

This newly introduced insurance is available through the DubaiCare Network or other products from accredited insurance providers via various channels, including the Insurance Pool website, smart applications, and business service centers across the UAE.

The policy has a validity of two years, and if the visa is canceled, the second-year premium may be refunded.

The basic insurance package is priced at AED 320 per year, with no waiting period for workers with chronic illnesses. It covers individuals aged up to 64; those over this age must complete a medical disclosure form and provide recent medical reports.

Coverage includes treatment expenses, requiring a 20 percent co-payment for inpatient care for hospitalizations or surgeries. The insured pays a maximum of AED 500 per visit, capped at AED 1,000 annually for medications. Beyond these limits, the insurance company covers all treatment costs.

For outpatient care, patients needing medical visits, diagnostic tests, or minor procedures without hospital stays face a 25 percent co-payment, with the insured contributing a maximum of AED 100 per visit.

There is no co-payment required for follow-up visits within seven days for the same condition, and there is a 30 percent cap on medication co-payments, capped at AED 1,500 annually.

The basic plan network includes seven hospitals, 46 clinics and medical centers, and 45 pharmacies.

Dependents of the worker’s family can avail themselves of the same benefits and pricing outlined in the insurance policy.

UAE Lottery draw December 14 big update, you’ve won a prize

From early ticket purchasers to those waiting until the final moments, many residents of the UAE are eagerly anticipating the inaugural live draw of The UAE Lottery.

On Saturday, December 14, participants and viewers will discover whether the Dh100-million grand prize will be claimed. Keep in mind that a ticket-buyer faces a one-in-8.8-million chance of winning the jackpot.

Since its recent launch, some residents are still getting familiar with The UAE Lottery. Many of the ticket buyers are in a wait-and-see mode, eager to observe how the main ‘Lucky Day‘ draw unfolds.

Here’s a comprehensive guide to the draw, claiming prizes, and potential issues that participants may face:

Where to Watch The UAE Lottery Draw

The first-ever draw for The UAE Lottery will take place at 8:30 PM on Saturday, December 14.

You can watch it live on the gaming platform’s official YouTube channel: https://www.youtube.com/@theuaelottery/streams

Although updates will be posted on their Facebook, Instagram, and X pages, tuning in via YouTube is recommended for the best experience.

Can a Player Change or Cancel a Lottery Ticket?

If you wish to alter your numbers after purchasing a ticket, unfortunately, you cannot make any changes. Once a ticket is bought, it cannot be canceled.

Troubles Logging In?

To purchase tickets, you will need to register, selecting a username (either your phone number or email address) and creating a password.

If you forget your password, click on ‘Forgot password‘ on the login page. If you forget your username, please email support@theuaelottery.ae for assistance.

Remember, once created, your username cannot be changed.

To update your password, click on your profile in the top right corner, navigate to ‘Account Info’, and select ‘Change Password.

What to Do If Your Bank Card is Declined

To participate and purchase tickets, you need to deposit credits into your account, with a Dh50 payment required for each ticket.

When entering your bank card details for payment, there are instances where deposits may fail due to your bank not processing commercial gaming transactions (MCC 7995). If this happens, please contact your bank.

Alternatively, you can opt to pay using PayBy (www.payby.com).

If you are outside of the UAE or in a region where commercial gaming is banned, your transaction is likely to be declined. The same applies if you are in the UAE but in sensitive areas, like a mosque.

How to Know If You’ve Won a Prize

If you have purchased a ticket through your account with The UAE Lottery, you will receive a notification if you win. You’ll need to log in to check detailed prize information.

For the Lucky Day draw, you can find the winning numbers on the website or through The UAE Lottery’s official social media accounts.

How to Claim a Prize

For prizes up to Dh100,000, the amount will be credited directly into the winner’s account.

For cash prizes exceeding Dh100,000, winners must reach out to The UAE Lottery via support@theuaelottery.ae or call 800 2365.

Important: Winners have a 180-day window to claim their prizes; afterwards, the prize will be forfeited.

Those who win significant sums will need to wait roughly 30 days for validation procedures to take place.

When claiming a large prize, participants may need to provide various personal details, including: full name, address, date of birth, gender, email address, phone number, current photo, facial scan or equivalent visual ID for facial recognition, payment details, and proof of eligibility to claim the prize.

India and UAE Strengthen Ties Through Historic India-Middle East-Europe Corridor Initiative

India, UAE discuss India-Middle East-Europe Corridor: PM Modi meets UAE deputy PM

Prime Minister Narendra Modi and United Arab Emirates (UAE) Deputy Prime Minister and Foreign Minister Sheikh Abdullah bin Zayed Al Nahyan held high-level talks on Thursday to discuss the implementation of the India-Middle East-Europe Corridor (IMEEC), a strategic initiative aimed at enhancing regional connectivity and prosperity.

PM Modi highlights IMEEC as a ‘historic initiative’

Prime Minister Modi stressed the importance of IMEEC during the discussion, describing it as a transformational project to enhance economic connectivity and regional integration. He also conveyed his best wishes to UAE President Sheikh Mohammed bin Zayed Al Nahyan.

The talks highlighted the usual high-level bilateral cooperation between the two countries, including Abu Dhabi Crown Prince Sheikh Khaled bin Mohamed bin Zayed Al Nahyan’s visit to India in September 2024, which PM Modi termed a sign of “generational continuity” in bilateral relations.

Strengthening comprehensive strategic partnership

Both the leaders stressed the importance of deepening comprehensive strategic cooperation between India and the UAE in areas such as:

While the UAE Foreign Minister also shared insights on the prevailing situation in West Asia, PM Modi reiterated India’s commitment to peace, stability and stability in the region.

Focus on Indians in the UAE

Prime Minister Modi expressed his gratitude to the UAE leadership for supporting the welfare of Indian expatriates living in the UAE. These regions are an integral part of bilateral relations, contributing to economic and cultural exchanges.

PM Modi on regional stability

In a post on X (formerly Twitter), PM Modi stated, “Happy to receive Deputy PM and Foreign Minister of the UAE, HH AB Zayed. India-UAE Comprehensive Strategic Partnership is poised to achieve unprecedented heights. We are committed to working towards peace, stability, and security in West Asia and the wider region.”

Diplomatic Visit: The post captures a meeting between Indian Prime Minister Narendra Modi and Sheikh Abdullah bin Zayed Al Nahyan, the Deputy Prime Minister and Foreign Minister of the UAE, aimed at enhancing the India-UAE Comprehensive Strategic Partnership. This partnership focuses on elevating relations to new heights in areas like trade, energy, technology, and regional stability.

Strategic Dialogue: The visit included the 4th India-UAE Strategic Dialogue where discussions covered cooperation in trade, energy, technology, and more, reflecting a commitment to peace, security, and prosperity in West Asia and beyond.

Geopolitical Implications: The meeting underscores India’s strategic interests in West Asia, aiming to leverage its position in the region for peace and stability, aligning with India’s broader foreign policy under the Modi government.

Key bilateral meetings

Sheikh Abdullah bin Zayed Al Nahyan was in New Delhi to attend the 4th Strategic Dialogue and the 15th India-UAE Joint Commission Meeting, both crucial platforms for advancing mutual cooperation.

This meeting is seen as a step forward in further solidifying the India-UAE relationship while pushing forward the ambitious India-Middle East-Europe Corridor initiative, a project with the potential to reshape global trade dynamics.

UAE New Tax Rule from January 2025

UAE to impose 15% minimum top-up tax on large multinationals from January: The United Arab Emirates will impose a minimum top-up tax (DMTT) of 15% on large multinational companies operating in the country starting in January, the finance ministry said on Monday as the government seeks to boost non-oil revenue.

The DMTT is part of the OECD’s global minimum corporate tax agreement which has 136 signatories, including the UAE, to ensure big companies pay a minimum 15% and to make tax avoidance harder.

In amendments to the corporate tax law, the UAE’s finance ministry said the DMTT will apply to companies with consolidated global revenue of 750 million euros ($793.50 million) or more in at least two out of the four financial years preceding the ones in which the tax comes into effect.

The UAE, including Dubai, is a hub for multinationals in the Middle East and the tax amendments come a year after the UAE began rolling out a 9% business tax, with exemptions for the many free zones which power its economy.

The DMTT comes under the Organisation for Economic Co-operation and Development’s (OECD) Two-Pillar Solution, which stipulates that large multinational enterprises pay a minimum effective tax rate of 15% on profits in each country where they operate.

The UAE’s finance ministry said it is also considering introducing a number of corporate tax incentives, including one for research and development (R&D) that would apply for tax periods starting in 2026.

The expenditure-based incentive would offer a potential 30%-50% refundable tax credit depending on the size of the company’s operations in the UAE and revenue, the ministry added.

A refundable tax credit for high-value employment activities that would be granted to companies as a percentage of eligible income costs for employees is also being considered and could be applied as early as Jan. 1 2025, the ministry said.

Such proposed incentives remain subject to legislative approval.

($1 = 0.9452 euros)

Everything You Need to Know About the UAE Lottery: Ticket Prices, How to Play, and Winning Odds

UAE Lottery: Ticket Price, How to Play, and Odds of Winning the Dh100 Million Jackpot

The UAE Lottery has been officially launched, nearly four months after its announcement. Tickets are available for purchase on the official website http://www.theuaelottery.ae. Operated by The Game LLC, it is the first and only regulated lottery operation in the UAE.

Tickets are priced at Dh50, offering players a chance to win a life-changing jackpot of Dh100 million. Below is a guide to the games, prizes, and odds of winning.

What Games Are Available?

Currently, the lottery features two games:

  • Lucky Day
  • Scratch Cards

Additional games may be introduced in the near future.

How to Play ‘Lucky Day’

Each entry in ‘Lucky Day’ costs Dh50. Players select six numbers from the ‘Days’ section and one from the ‘Months’. To win the jackpot, all seven numbers must match the draw result.

Prizes are distributed as follows:

  • Second Prize: Match all six numbers from the ‘Days’.
  • Third Prize: Match five from ‘Days’ and one from ‘Months’.
  • Fourth Prize: Match either five from ‘Days’ or four from ‘Days’ plus one from ‘Months’.
  • Fifth Prize: Multiple combinations including matching three from ‘Days’ and one from ‘Months’, two from ‘Days’ and one from ‘Months’, or just one from either section.

What Are the Odds of Winning?

According to the UAE Lottery, the odds of winning are as follows:

  • Jackpot (Dh100 million): 1 in 8,835,372
  • Second Prize (Dh1 million): 1 in 803,216
  • Third Prize (Dh100,000): 1 in 58,902
  • Fourth Prize (Dh1,000): 1 in 1,437
  • Fifth Prize (Dh100): 1 in 12.1

What Is a ‘Lucky Chance’?

Each ticket purchased generates a corresponding ‘Lucky Chance ID’. During the live draw for ‘Lucky Day’, an additional draw will occur for ‘Lucky Chance’. For the inaugural draw on December 14, seven ‘Lucky Chance IDs’ will win Dh100,000 each.

What Happens If There Are Multiple Jackpot Winners?

In the case of multiple jackpot winners, the amount will be evenly divided among the winning ticket holders.

How Often Is the Draw?

Live draws will take place bi-weekly on Saturdays at 8:30 PM UAE time.

When Can Tickets Be Purchased?

Tickets can be bought from 10 PM on the draw date until 7 PM on the following Saturday. During the live draw, ticket sales will be suspended from 7 PM to 10 PM.

Can One Entry Win Multiple Prizes?

Each entry in a draw series can win only once. If an entry wins multiple prizes, only the largest prize will be awarded.

What Are Scratch Cards?

Scratch cards can be purchased for a chance to win up to Dh1 million. Prices start at Dh5, offering a maximum win of Dh50,000. Dh10 cards can win up to Dh100,000, Dh20 cards offer a top prize of Dh300,000, and Dh50 cards provide a chance to win Dh1 million.

BASICS OF TAXES IN UAE

Basics of Taxes in UAE

Introduction :

UAE – Tax Free? If you think yes, please continue reading to have a better reality check and update yourself on this aspect.

UAE does not have Income Taxes but “The Federal Tax Authority (FTA)” does levy two types of taxes as below –

VAT & UAE :

After a glimpse of the above structure, this article is going to focus on Value-added Tax in UAE. VAT is the GST equivalent levy. It is a consumption-based tax and the burden of the levy is ultimately borne by the end-consumer. VAT is levied at each step of the supply chain transaction.

This means that the VAT is collected at each of the below stages :

Manufacturer >>> Wholesaler >>> Retailer >>> End Consumer

And the credit for VAT collected at each subsequent stage is availed for in the next stage and any additional VAT liability is to be collected by the seller from the purchaser and to be paid to the account of the government by the seller of the goods/ services.

(adsbygoogle = window.adsbygoogle || []).push({});

FAQ’s :

Q1. Is VAT applicable to only goods?

A1. No, VAT is applicable to both goods and services. It is GST equivalent levy.

Q2. Is VAT levied on imports and exports?

A2. Yes, VAT is levied on imports so as to ensure that the local goods and imported goods have a fair play.
However to ensure that the exports are globally competitive, the same are liable to VAT @ 0%.

Q3. Is VAT levied only in UAE or (Gulf Course Countries) GCC?

A3. With efforts under-pipeline, the same is expected to be levied in the whole GCC but for now, the same pertains to UAE and majority of GCC. There are certain exceptions when countries in GCC might not comply with the VAT levy.

Q4. Who is liable to register for VAT?

A4. Any business whose taxable supplies and imports exceed the annual threshold of AED 375,000 is liable to obtain registration from FTA.

Q5. Can I obtain voluntary registration for VAT?

A5. Voluntary registration for VAT is permitted Only If –

1. Their supplies and imports are below the threshold limit of AED 375,000 but exceed AED 187,500. Or

2. The expenses exceed the voluntary registration threshold limits i.e. AED 187,500.

(adsbygoogle = window.adsbygoogle || []).push({});

Q6. What are the responsibilities of VAT-registered business?

A6. VAT registered businesses must –

1. Charge VAT on taxable goods or services supplied

2. Re-claim VAT already paid by them and

3. Maintain business records allowing government to check the accuracy

4. File online VAT reports as prescribed by FTA

Q7. At what rate is VAT levied?

A7. VAT is levied at a standard rate of 5%.

Q8. Which other sectors are liable to VAT @ 0%

A8. Certain Investment grade precious metals, supply of newly constructed residential properties (first time sale and within 3 years of construction) and certain supplies of educational and healthcare services are liable to VAT @ 0%.

Q9. Are some services exempt from VAT?

A9. Yes, local transport, supply of bare land and residential properties are exempt from VAT. Also certain specified financial services are exempt from VAT.

Q10. Are Zero-rated and exempt categories different?

A10. Yes, though in effect no VAT is to be paid under either category both the categories are different. Zero-rated goods/services are the ones wherein VAT is applicable but at a “0” rate. Correspondingly exempt goods/services are outside the ambit of VAT. This means if the rates on zero-rated category changes, they are liable to VAT at the revised rate.

(adsbygoogle = window.adsbygoogle || []).push({});

Q11. Is VAT levied on government transactions?

A11. Supplies made to the government are liable to VAT for ensuring a fair play. However if the supplies are made by the government, i.e. supplier is the government, then certain categories of supplies are excluded from the scope of VAT.

The suppliers are generally so excluded if they are the only player in the industry. Further certain government entities are also liable to refunds for the supplies made by them.

Wrapping Up :

With slight variations to adopt to the local scenario, the VAT in UAE has a widely replicated and generic version of the global indirect taxes. For more details on Selective Taxes, please stay tuned for the next article in the same series.

Meanwhile if you have any concerns, ideas or opinions, please do feel free to voice out the same to me. I am happy to discuss.

Thanks for reading my article on “Basics of Taxes in UAE”

Disclaimer : IN NO EVENT THE AUTHOR SHALL BE LIABLE FOR ANY DIRECT, INDIRECT, SPECIAL OR INCIDENTAL DAMAGE RESULTING FROM OR ARISING OUT OF OR IN CONNECTION WITH THE USE OF THIS INFORMATION. THIS HAS BEEN SHARED FOR KNOWLEDGE PURPOSES ONLY.

AUTHOR : CA HEER GAJJAR (CLICK HERE TO VIEW PROFILE)

Follow Us on LinkedIn for Job Updates : Click Here to Visit LinkedIn Profile

(adsbygoogle = window.adsbygoogle || []).push({});