UAE to introduce 9% corporate tax on business profits from June 1, 2023 (FZCO REMAINS 0%)
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Probably it is income which is not sourced from mainland, I read somewhere that if a Freezone has income from UAE mainland that income will be subject to CT so here they want to make a different between foreign income and UAE sourced income, probably.
On the first line in fact it says: "A Free Zone Person that is Qualifying Free Zone Person can benefit from a preferential Corporate Tax rate of 0% on their "Qualiying Income""
On the first line in fact it says: "A Free Zone Person that is Qualifying Free Zone Person can benefit from a preferential Corporate Tax rate of 0% on their "Qualiying Income""
Transactions between free zones should be out of the scope of CT, but let’s wait the opinion of a more experience person regarding this matter.
According to this page Qualifying income is any income receieved by the Qualifying Free Zone Person (which is defined as any freezone company, barring exceptions). UAE: Key highlights of the corporate tax law.
I would imagine that gets redefined as any income received from outside of UAE in the future.
I would imagine that gets redefined as any income received from outside of UAE in the future.
I think its more like you are a qualifying free zone person if you have substance in the UAE and any income you receive is qualifying income, which just happens to be 0% taxed. As the article mentions the definition of qualifying income will probably be amended, otherwise all income of a free zone person would be outside of the scope of CT, which I suppose is what people in this thread have been saying all along...
There is a whole tutorial on this: https://mof.gov.ae/economic-substance-regulations/
Also here: Insights into the UAE Economic Substance Regulations
Although from my reading economic substance is only required for some activities. But, as noted above you will need substance to open a bank account anyway.
Also here: Insights into the UAE Economic Substance Regulations
Although from my reading economic substance is only required for some activities. But, as noted above you will need substance to open a bank account anyway.
I Cannot say. I have no opinion on the article. 😉
It is a personal opinion, which is whatever personal opinions are.
It is a personal opinion, which is whatever personal opinions are.
Your totally right. KPMG and PWC also give personal opinions. I think there is a lot of personal opinion out there 😉.
Correct.
Freezone to︂ Freezone - no UAE Mainland sourced income - 0% CT.
I'm surprised that︅ still so many guys are surprised about this fact - it's "good global standard" eye︆ wishing "we are with OECD and FATF" bla bla bla.
Not to talk about the︇ actual law enforement of CT - never seen expats getting pissed of by the UAE︈ GoV who actually bring in all the money and forming the whole UAE real estate︉ etc.
Freezone to︂ Freezone - no UAE Mainland sourced income - 0% CT.
I'm surprised that︅ still so many guys are surprised about this fact - it's "good global standard" eye︆ wishing "we are with OECD and FATF" bla bla bla.
Not to talk about the︇ actual law enforement of CT - never seen expats getting pissed of by the UAE︈ GoV who actually bring in all the money and forming the whole UAE real estate︉ etc.
I am trying to understand, if Online Day Traders (trading on online brokers, securities, cryptos...), trading their own assets (in their personal capacity) will have to pay the 9% CT ?
In the new Decree they define :
https://mof.gov.ae/wp-content/uploads/2022/12/Federal-Decree-Law-No.-47-of-2022-EN.pdf
Business : « any activity conducted regularly on an ongoing and independant basis by any Person and in any location, such as industrial, agricultural, vocational, professional, service or excavation activities or any other activity related to the use of tangible or intangible assets »
Business activity : « any transaction or activity, or series of transactions or series of activities conducted by a Person in the︀ course of Business »
So it would mean someone who Trade actively own assets would︁ fit in this definition
However following to that the FAQ published by MOF says about︂ Natural persons seems to contradict that point:
https://mof.gov.ae/corporate-tax-faq/
« UAE and foreign individuals will not︃ be subject to UAE CT on dividends, capital gains and other income earned from owning︄ shares or other securities in their personal capacity »
does it fit if you actively︅ trade these ?
Corporate Tax in the UAE,Are You Ready? (Part 1)
The analyst in︆ this article :said even though it is not 100% sure, that business which should be︇ taxed should be these requiring a licence, but day trading your own assets (securities, cryptos)︈ do not require a licence.
It seems there is a difference between natural persons and︉ business on CT, but they did not decide which natural person will be shielded from︊ that tax :"The Cabinet shall, upon a suggestion of the Minister and in coordination with︋ the relevant competent authorities, issue a decision specifying the categories of Business or Business Activity︌ conducted by a resident or non-resident natural person that are subject to Federal Decree-Law No.︍ 47 of 2022 - Unofficial translation 15 Corporate Tax under this Decree-Law."
If you need︎ to pay 9% on trading your own assets, with all the risks and audits necessities️ it bring it makes it not attractive.
Do you think this tax applies to natural persons resident who actively/regularly trade their own assets ? (securities, crypto, futures, …)
In case yes, how is the starting date going to be determined as there is no personnal income tax return currently, will it be &st january 2024 or 1st June 2023 ?
In the new Decree they define :
https://mof.gov.ae/wp-content/uploads/2022/12/Federal-Decree-Law-No.-47-of-2022-EN.pdf
Business : « any activity conducted regularly on an ongoing and independant basis by any Person and in any location, such as industrial, agricultural, vocational, professional, service or excavation activities or any other activity related to the use of tangible or intangible assets »
Business activity : « any transaction or activity, or series of transactions or series of activities conducted by a Person in the︀ course of Business »
So it would mean someone who Trade actively own assets would︁ fit in this definition
However following to that the FAQ published by MOF says about︂ Natural persons seems to contradict that point:
https://mof.gov.ae/corporate-tax-faq/
« UAE and foreign individuals will not︃ be subject to UAE CT on dividends, capital gains and other income earned from owning︄ shares or other securities in their personal capacity »
does it fit if you actively︅ trade these ?
Corporate Tax in the UAE,Are You Ready? (Part 1)
The analyst in︆ this article :said even though it is not 100% sure, that business which should be︇ taxed should be these requiring a licence, but day trading your own assets (securities, cryptos)︈ do not require a licence.
It seems there is a difference between natural persons and︉ business on CT, but they did not decide which natural person will be shielded from︊ that tax :"The Cabinet shall, upon a suggestion of the Minister and in coordination with︋ the relevant competent authorities, issue a decision specifying the categories of Business or Business Activity︌ conducted by a resident or non-resident natural person that are subject to Federal Decree-Law No.︍ 47 of 2022 - Unofficial translation 15 Corporate Tax under this Decree-Law."
If you need︎ to pay 9% on trading your own assets, with all the risks and audits necessities️ it bring it makes it not attractive.
Do you think this tax applies to natural persons resident who actively/regularly trade their own assets ? (securities, crypto, futures, …)
In case yes, how is the starting date going to be determined as there is no personnal income tax return currently, will it be &st january 2024 or 1st June 2023 ?
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