International Taxation
Economic Substance Advisory
Certain types of entities to maintain and demonstrate an adequate & relative “economic presence” in the UAE. We advise on its compliance to avoid hefty penalties.
Certain identified & defined types of entities to maintain and demonstrate an adequate “economic presence” (in terms of employees, assets and expenditure) in the UAE relative to the activities they undertake. This is a part of the UAE’s commitment as a member of the OECD Inclusive Framework, and in response to an assessment of the UAE’s tax framework by the European Union Code of Conduct Group on Business Taxation
We advise on its compliance to avoid hefty penalties ranging from AED 20,000 up to AED 400,000
Economic Substance Regulations apply to financial years commencing on or from 1 January 2019. Entities that are within the scope of the Regulations are required to submit an annual Notification form within 6 months and an Economic Substance Report within 12 months from the end of their financial year. Failure to comply with the Regulations can result in penalties, spontaneous exchange of information with the Foreign Competent Authority as well as other administrative sanctions such as the suspension, revocation or non-renewal of the entity’s trade license or permit.
We ensure that our clients remain compliant always to avoid any kind of penalties.
Visit : https://mof.gov.ae/economic-substance-regulations/ to know more and ask us any of your queries and requirements.
Transfer Pricing (International)
Transfer Pricing traditionally is more international than domestic. We bring that out for compliance and avoid penalties.
Transfer Price is the price which is applied or proposed to be applied in a transaction between related persons and connected persons. This needs to be at Arm’s Length, which is nothing but Price which is applied or proposed to be applied in a transaction between un-related person in un-controlled conditions.
We endeavour to highlight that Transfer Pricing is more international than domestic. This comes to use more in international transactions by their sheer volume. Transfer Pricing comes into picture as soon as ‘Related Persons and Connected Persons’ comes into a commercial transaction as parties.
We endeavour to keep an eye on such international transactions and make one’s business remain compliant with not only UAE CT Laws but also foreign jurisdictions regulations including OECD Guidelines, by making required adjustments.
Transaction Structuring
Tax Planning begins with initiation of any commercial transaction, more so with a cross-border transaction. Whether it is Sales, Purchases, Receipts and Payments or Asset Purchase, Stock Purchase or Mergers.
For a deal to be considered successful, it must be mutually beneficial for both the Buyer and the Seller. Apart from the Price and Profitability, Tax Liability plays a vital part in any negotiation. We take care of it at this very inception of the deal. This brings clarity and control.
We are experienced in advising on the Corporate Tax aspects of transactions. We undertake tax due diligence in providing structuring. We also advise on the cross-border tax implications of transactions involving overseas entities and where necessary, we obtain opinions and detailed advice from our worldwide affiliates and associates.
Tax Treaty Interpretation & Advisory
This plays a key role in avoiding double taxation in your multi-country operational needs.
Tax Treaty Interpretation prevents double taxation by planning for and managing international income tax treaties. With only one country is interpreting the treaty on any given issue, Treaties themselves provide protection against double taxation.
Our International Tax Advisory associated team members are focused on implementing practical tax solutions to align with your multi-country operational needs. This includes the use of Double Tax Treaties, which override domestic tax laws to avoid double taxation.
If one fails to plan or seek accurate advice regarding Tax Treaties interpretation, one won’t be able to factor it into one’s cross-border business decisions. And this can lead to avoidable tax leakage and potentially damaging ongoing financial outflows.
We compare worldwide international tax treaties and rates, compare income tax treaties of any status from over 180 countries.
Withholding Tax and Foreign Tax Credit
These two need to be factored in one’s cross-border transactions to avoid tax leakage.
If one fails to plan or seek accurate advice regarding Withholding Tax or Foreign Tax Credit, one won’t be able to factor them in their cross-border business transactions’ decisions. This can lead to avoidable tax leakage and potentially damaging ongoing financial outlays.
Our International Tax Advisory associated team members are focused on implementing practical tax solutions to align with your multi-country operational needs. The team’s extensive knowledge and experience of tax treaties makes us better placed to assist with withholding tax, foreign tax credit planning and leakage reviews, including the cross-border provision of services, financing, and IP.
