Introduction

  • Do you have business in two different countries?
  • Have you structured your operating and holding companies considering the tax laws of each of the countries you have business relationship in?
  • Are you aware of the tax, accounting and regulatory requirements of each jurisdiction where you have business relationships? 
  • Do you wish to expand your business globally?

International Tax Planning, managing the complexities of multiple tax regulations around the world is what you would need. It is one of the vital aspect for any business, specially when business demands cross border transactions or global expansion. 

 

What is meant by International Taxation? 

International Taxation means adhering to varied tax laws of different jurisdiction, when an entity undertakes cross border transactions. It includes the application of tax laws in the respective jurisdictions and determining tax obligations of entities in the effected jurisdictions,. In general, an entity needs to determine whether it would be liable to tax based on its territorial income or residential status in a particular jurisdiction. 

 

Why International Taxation is more important now in the UAE?

UAE, a most rapidly growing business hub, is the gateway between Asia Pacific and Europe for cross border transactions. Hence International Tax Planning is very important matter for most of the businesses operating in this region.

To improve the international competitiveness, the UAE started shifting towards a taxation economy which encourages the transparency and improves economic diversification. The UAE introduced Excise Tax in the year 2017 and Value Added Tax (VAT) in 2018. Subsequently there are many developments with respect to improving international tax compliance in the country which are commendable and necessary.

The UAE has given green signal to the internationally agreed standards on exchange of information for tax purposes both “EOIR” (Exchange of Information on Request (‘EOIR’) and Automatic Exchange of Information (from OECD)

The UAE is largely complaint with the requirements of CRS (Common Reporting Standards) as well as FATCA to improve international tax compliance and international tax reporting.

The United Arab Emirates joined the Inclusive Framework of BEPS (“Base Erosion and Profit Shifting ”) on 16th May 2018 and became the 116th jurisdiction in the list. Hence the UAE is committed to implement BEPS 4 minimum standards. In the year 2019, UAE implemented the following two regulations;

  • Economic Substance Regulation through the Cabinet Resolution no 31 of  2019. [Economic Substance Regulation is a part of Action 5 of the Base Erosion and Profit Shifting] 

 

  • Country by Country Reporting – CbCR legislation through the Cabinet Resolution no 32 of  2019. [CbCR is a part of Action 13 of the Base Erosion and Profit Shifting (BEPS)] 

 

Now the United Arab Emirates is committed to the relevant overseas authorities to report within the time lines.

 

Our international tax services in UAE include

  • Corporate Tax – International level Advisory Service
  • International tax planning for entities
      • Initiating new business
      • Expanding business into new jurisdiction
  • Analysing special Cross border transactions
  • Global capital structure planning, including efficient cross-border finance, repatriation of funds and cash access planning 
  • Analysis withholding tax implications in each jurisdiction considering the Double Tax Avoidance Agreement in force
  • Transfer pricing Compliances
  • Guidance and Support for Compliance related to International Tax Reporting
  • Global Tax Compliance Management
  • Advisory Service on Tax for Expatriates
  • Personal Tax Advisory Service

 

How we Emirates Chartered help you with International Taxation? 

At Emirates Chartered Accountants Group, we have a team of expert tax professionals and consultants who are experienced in various tax regimes in the UAE as well as GCC. There is a separate wing for handling International Tax matters within the Tax division of Emirates Chartered Accountants Group. Tax experts in IECnet member firms in several countries work together on cases we handle which ensure that the transactions are handled in the most tax efficient manner that all laws are complied with.It helps you to avoid the pitfalls in decision making process and safeguards the probable tax risks. You can avail  tax opportunities through our guidance  on multiple tax regulations.

We address your concerns with an international mindset. We helped many businesses in their worldwide expansion for implementation of tax structures across the Middle East, Africa, Asia and Europe.

 

FAQ

Q: Your firm Emirates Chartered Accountants Group is a local firm I believe. How do you provide global tax solutions service, by operating from the UAE?

  • We are a global firm, with a local touch. We have our offices set up in United Kingdom, India and Bahrain.
  • As a member of IECnet, the Int’l Network of Auditors, Accountants & Tax Practitioners, (having participating firms from more than 65 countries), we have our wings spread internationally. This helps in giving credence to our advice and ensure practical viability.
  • Our expert international taxation team has experience of interpreting laws of multiple countries, that would assist you in tax planning.
  • Country specific compliances are executed through our network firms.

 

Q: My company is resident in Dubai. We are into service industry. We provide services internationally, including the countries which has prevalent Income-tax Law. Our clients hold-back certain percentage of payment as taxes in their country. How do we reduce or avoid the tax liability?

  • The countries in which the Income-tax provisions are enacted has a provision wherein, the payer shall deduct a certain amount and pay to the exchequer rather than the recipient paying Income-tax in the other country. These provisions are called withholding tax provisions. 
  • To avoid or reduce such deductibility at the time of payment, one will have to analyse the local laws along with the Double Tax Avoidance Agreement between the other country and the UAE. 
  • Also, the one can review if routing the transaction in a different manner would be economically and practically viable for the Company.

 

For International Taxation Services

Manu Palerichal
CEO & Partner

M:+971502828727| E:manu@emiratesca.com

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