UAE
UAE
The Ministry of Finance (MoF) of the United Arab Emirates (UAE) has recently announced the implementation of a new federal corporate tax (CT) system across the nation. This system mandates that applicable companies must undergo a corporate tax audit in the UAE. The new tax system will be effective for fiscal years commencing on or after June 1, 2023.
What is Corporate Tax Audit in UAE?
A corporate tax audit in the UAE is a compulsory procedure designed to examine the tax liability, tax compliance, and financial records of eligible companies. During this process, an auditor carefully reviews the company's financial statements, tax returns, and relevant documentation to identify any discrepancies or errors.
The purpose of conducting corporate tax audits is to enable the governing body to assess whether taxable organizations are adhering to the corporate tax laws and standards outlined by the Federal Tax Authority (FTA) in accordance with their guidelines. It is obligatory for all companies to comply with the Corporate Tax Law and undergo the necessary audit procedures.
Through tax audits, the FTA investigates whether taxable companies have settled all outstanding debts and ensured that all taxes are collected and paid to the authorities within the specified time frame. These audits play a vital role in ensuring tax compliance and maintaining the integrity of the tax system.
Which entities require a Corporate Tax Audit in the UAE?
As per Ministerial Decision No. 82 of 2023, a Corporate Tax Audit in the UAE is necessary for the following categories of entities that meet specific requirements:
It's important to note that corporate tax audits in the UAE are conducted based on these specified criteria and not randomly. To avoid the risk of fines or penalties associated with tax audits, businesses should ensure full compliance with all tax regulations and laws.
At A V Savla, our highly experienced legal experts provide successful assistance in Corporate Tax Audit Support Services in the following areas:
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