Cross Border Investments Navigating the UAE Tax Landscape

Cross Border Investments  

Navigation the UAE Tax Landscape

Cross Border Investments Navigating the UAE Tax Landscape

The United Arab Emirates (UAE) has become a key location for international investments. However, the UAE's taxation system is poised for a significant change as a result of the shifting nature of the global economy.

1.    Value-Added Tax (VAT)

  • 0% or 5% of taxable supplies made in the UAE (with VAT exemption on certain supplies)
  • VAT registration threshold (also applies on foreign companies with fixed establishment in the UAE)
  • Tax Grouping option

2.    Excise Tax (ET)

  • Applies to specific goods harmful to health or environment such as tobacco and carbonated / sweetened drinks
  • Applies on importing, manufacturing, stockpiling, and selling excise goods in the UAE
  • Concept of Designated Zone applies

3.    Customs Duty (CD)

  • 5% of goods imported at the first point of entry in the UAE
  • CD exemption on imports to Free Zone
  • Availability of temporary admission suspension regime

4.    Corporate Tax (CT)

  • Applies to foreign companies with place of business or management in the UAE.
  • Tax rate in the range of 0% - 9%.
  • Small business relief and participation exemption benefit subject to conditions

5.    Transfer Pricing (TP) and Country by country reporting (CbCR)

  • Mandatory TP documentation for entities with revenue > AED 200 Mn or Multinational entities (MNE) with group revenue > AED 3.15 Bn
  • CbCR applies to ultimate parent entities of UAE headquartered MNE with group revenue > AED 3.15 Bn

6.    Economic Substance Regulation (ESR)

  • Applies to UAE incorporated entities undertaking “relevant activities”
  • Annual filing compliances and demonstration of substance in the UAE is a must.

Contact Us

Markus Susilo
Markus Susilo
Partner- Payroll and Indirect Tax
Alessandro Valente
Alessandro Valente
Director - International Tax Service & Transfer Pricing
Michel Ruitenberg
  Partner DIFC - Indirect Taxes