Tax & Compliance Services in Dubai & UAE

Overview
Since 2018 the United Arab Emirates has shifted from a largely tax‑free jurisdiction to a rules‑based system that includes Value Added Tax (VAT), Corporate Tax (CT), Economic Substance Regulations (ESR) and extensive Anti‑Money Laundering (AML) reporting. Every UAE entity—whether Free Zone or Mainland—must keep proper books of account, file the right returns, and maintain audit‑ready records. This page explains the lifecycle of UAE tax and accounting compliance, the information you must prepare, and common traps to avoid.

Decisions Before You Begin

• Financial‑year selection – choose a 12‑month fiscal year that aligns with group reporting; it sets the due dates for CT and audited financials.
• VAT registration strategy – mandatory at annual taxable supplies ≥ AED 375,000; voluntary registration is possible at ≥ AED 187,500. Decide early based on sales projections.
• Accounting framework – IFRS, IFRS for SMEs, or another accepted standard; Free Zones often require IFRS for audit reports.
• Bookkeeping method & software – accrual accounting is required for VAT and CT; select cloud software (e.g., Odoo, Xero, QuickBooks) that supports multicurrency and e‑invoicing.
• Bank‑account hygiene – maintain a dedicated business account; mixed personal transactions complicate audit trails and may trigger bank compliance reviews.
• Group structuring for CT – consider 0 % CT “Qualifying Free Zone Person” status or CT group relief; elections must be filed before the first CT return.

Critical Pre‑Compliance Checklist

Documents & Information to Have Ready

Tax & Accounting Compliance Roadmap

*Timelines reflect regulations in force as at June 2025; authorities may update portals or due dates.

Do’s & Don’ts

Dont’s

1. Don’t claim input VAT without a valid tax invoice— missing TRN or address voids recovery.
2. Don’t back‑date credit notes— they must reference original invoice numbers and dates.
3. Don’t ignore “De‑registration”— if taxable turnover falls below AED 187,500, apply to deregister within 20 days to stop penalties.
4. Don’t pay suppliers in cash— cash payments over AED 10,000 can trigger AML reviews and are hard to substantiate.
5. Don’t miss ESR reporting— fines start at AED 20,000 escalating to AED 400,000 for repeat offences.
6. Don’t treat Free Zone income as automatically 0 %— “Qualifying Income” tests and substance rules apply from June 2023.

Common Pitfalls & How to Avoid Them

• Late VAT registration – penalties of AED 10,000 plus 1 % of unpaid tax per month. Track turnover and register early if near the threshold.
• Incorrect expense classification – entertainment vs. staff welfare has different VAT recovery rules. Create clear expense codes in your software.
• Unreported related‑party transactions – FTA scrutinises interest‑free loans and management‑fee charges; prepare transfer‑pricing support.
• Missing bank confirmation letters – auditors require third‑party confirmations; request at least 30 days before audit sign‑off.
• Mismatch between customs value and purchase invoice – leads to blocked input VAT; ensure import declarations mirror commercial invoices.

Annual & Ongoing Essentials

1. Monthly/Quarterly closings – reconcile ledgers, review ageing, and post accruals.
2. Fixed‑asset verification – conduct a physical count annually to support depreciation claims.
3. Quarterly AML screening – run shareholder/director names through sanction & PEP lists.
4. Board approval of financials – pass a resolution adopting the audited accounts before CT filing.
5. Continuous professional‑development – UAE tax rules evolve; subscribe to FTA and MoF bulletins.

Packages (prices exclude VAT)