UAE Corporate Tax: Do All Taxable Persons Need to Have Books of Accounts Audited?
The UAE corporate tax law states that the Minister of Finance may issue a decision explaining the types of taxable persons who need to prepare and maintain audited financial statements. The Ministerial Decision No (82) of 2023 clearly states the categories of businesses that are required to maintain audited financial statements for corporate tax in the UAE.
Taxable persons need to read both the UAE Corporate Tax Law and the related Ministry Decision to ensure compliance. It is advisable to consult with corporate tax consultants in Dubai to accurately interpret the Law and the Ministerial Decision No (82) of 2023 on the Determination of Categories of Taxable Persons Required to Prepare and Maintain Audited Financial Statements. The following categories of taxable persons must maintain audited financial statements for corporate tax:
1. Businesses above AED 50 million threshold
Taxable persons with revenue exceeding AED 50 million are required to prepare and maintain audited financial statements during the relevant Tax Period. Keeping the threshold at AED 50 million in revenue for audited financials is likely to give great compliance relief to small and medium enterprises (SMEs). Corporate tax advisers in Dubai can help such businesses with financial statement requirements.
2. All Qualifying Free Zone Persons
Qualifying Free Zone Persons are the second category of taxable persons that are required to maintain audited financial statements for corporate tax purposes in the UAE. Maintaining Audited Financial Statements is highly critical for Qualifying Free Zone Persons as it helps them leverage the 0% tax on Qualifying Income.
All Qualifying Free Zone Persons must maintain the audited financial statement, irrespective of the revenue amount. Businesses can assess their eligibility under this category by consulting with corporate tax consultants in Dubai, UAE.
Audit requirements other than CT Law
Compliance with corporate tax requirements in the UAE should not be the only reason why you should prepare audited financial statements. Getting your financial statements audited is also beneficial for companies for the following reasons as well:
- FZ authority requirement requirements other than qualifying FZ persons
- Bank requirements for companies having any kind of facility
- Insurance brokers and companies as per CBUAE (Central Bank of the UAE)
- Exchange houses as per CBUAE requirement
- Hotels as per the Department of Economy and Tourism (DET ) requirement
- To attract investors as they rely upon audited financial statements for funding or buying new companies
- To detect and prevent fraud within the organisation
Gain UAE Corporate Tax Knowledge through Tax Gian
Taxable persons falling in any of the two categories mentioned in Ministerial Decision No (82) of 2023 are required to maintain audited financial statements. To make the compliance process flawless, businesses can seek help from Tax Gian, the tax division of Jitendra Chartered Accountants (JCA). At Tax Gian, a dedicated team of Chartered Accountants work nonstop to advise clients and share knowledge on Corporate Tax and Value Added Tax.
We are one of the leading providers of corporate tax advisory services in Dubai with impeccable expertise and experience. Our corporate tax consulting services in Dubai include CT Assessment & Advisory Services (on a one-time or retainer basis), CT Transfer price assessment services, CT Compliance Services & CT Agent Services to Represent the Federal Tax Authority (FTA) of UAE in case of any notices served by FTA. Ensure corporate tax compliance and avoid relevant penalties by availing of JCA’s corporate tax services in Dubai, UAE. Talk to our consultants for tax solutions that you can count on.