Tax Updates November 2022

The UAE issues federal decree law on Corporate Tax

On 09 December 2022, the UAE Ministry of Finance released the long-awaited Corporate Tax Law (Federal Decree Law No. 47 of 2022, “CTL”). It will come into effect 15 days after its publication and will be applicable to tax periods commencing on or after 01 June 2023. The corresponding Implementing Regulations are expected to be published any time soon.

Amendment of the UAE VAT Regulations

The United Arab Emirates (UAE) Cabinet issued Cabinet Decision No. 99 of 2022 amending the provisions of Articles 3 and 72 of the UAE VAT Executive Regulations. As per the new amendment, the functions of a member of a board of directors are no longer considered a supply of services. The amendments are effective from 01 January 2023.

Tax Procedures Decree Law

On 4 November 2022, the UAE's Ministry of Finance issued Federal Decree Law No. 28 of 2022 on Tax Procedures (New TPL) repealing Federal Decree Law No. 7 of 2017 on Tax Procedures (Current TPL). The New TPL will come into effect on 1 March 2023.

This New TPL amends various articles included of the Current TPL and introduces new provisions. The most significant changes relate to definitions, language, offset of tax liabilities against tax receivables, voluntary disclosure, tax agents, timeframe for notifying taxpayers of a tax audit/assessment, the amount of administrative penalties, the amount of tax audits and refunds, collection of taxes if there is a risk of revenue loss, the monetary penalties for tax crimes, the statute of limitations, and the dispute resolution process.

New VAT Public Clarification – Gold-Making charge

Based on a new decision by the Cabinet, the definition of goods in Cabinet Decision No. 25 has been amended to state that it may include Making Services directly in connection with the Gold, for the limited period between 1 June 2018 and 31 December 2022. This temporary change in definition would allow for the application of the reverse charge mechanism on the Making Services that are directly in connection with the supply of Gold, where the conditions as stipulated in Cabinet Decision No. 25 of 2018 are met for that specific period only.

New law boosts UAE's position as a family business hub

On Monday, 28 November, the Ministry of Economy organized a media briefing in Abu Dhabi to introduce the Federal Decree Law No. 37 of 2022 on family businesses which forms part of the Government's comprehensive and long-term strategy to enhance and raise the family business environment in the country globally competitive levels.

According to the law, a family-owned company is a company established in accordance with the provisions of the Commercial Companies Law in the country, with most of its shares owned by people belonging to one family. It must be registered in the unified family business registry, which is established under the provisions of this law.

Customs Notice on Procedures and Fees of Commercial Invoices Attestation by the Ministry of Foreign Affairs & International Cooperation for Imports to Local

The Dubai Customs vide Customs Notice No. (11/2022) issued on 02 November 2022 decided that the Ministry of Foreign Affairs and International cooperation shall collect a fixed fee of AED 150 for attestation of each commercial invoice of imported goods value more than or equal to AED 10, 000. Declarants should finalize the payment of attestation fees within a maximum of 14 days from date of completing the customs declaration, and non-compliance would attract administrative penalties.

Amending Protocol to Tax Treaty between Switzerland and the UAE Signed

On 5 November 2022, officials from Switzerland and the UAE signed an amending protocol to the 2011 tax treaty between the two countries.

Corporate Tax