International taxation in the UAE is evolving and getting updated on real-time basis at an unprecedented rate. Base Erosion and Profit Shifting (‘BEPS’) which refers to tax avoidance strategies that exploit gaps and mismatches in tax rules to artificially shift profits to low or no-tax locations, has been the focus of anti-tax avoidance discussions globally. The United Arab Emirates has become the 116th jurisdiction to join the Inclusive Framework on BEPS (“IF”) to implement the BEPS measures and tackle BEPS.
PKF International tax experts can help you consider/evaluate the developments pertaining to BEPS as may be applicable for your business, ensure compliance with internationally agreed standards on exchange of information for tax purposes and analysing tax treaties for any beneficial provisions affecting your business transactions and structures.
In line with the growing competitiveness of the world economy, the UAE’s shift towards a taxation economy is both commendable and necessary, as it encourages economic diversification and boosts transparency. In addition to the introduction of Excise duty and VAT in the UAE, there are several developments with respect to improving international tax compliance which merits attention.
The UAE is a global forum member and signatory of the Exchange of Information on Request (‘EOIR’) and Automatic Exchange of Information initiatives of the OECD, both being internationally agreed standards on exchange of information for tax purposes. While the UAE is largely compliant as per the EOIR rating round 1, the first exchange of information under CRS is scheduled to take place in 2018.
The UAE has also concluded an agreement with the USA to improve international tax compliance /reporting (commonly known as FATCA) and which has been implemented successfully with requisite reporting periods.
Considering the aforementioned key tax developments in the UAE, working with qualified tax experts can not only allow you to focus on your business but also reduce the risk of non-compliance with the law and resultant penalties.
At PKF, we have an in-house team of expert tax professionals and consultants who have experience of working in various tax regimes in the UAE. We also have access to tax experts in PKF member firms in several countries who can assist companies in structuring deals and transactions in the most tax efficient manner whilst ensuring that all laws are complied with.
PKF provides VAT advisory Services in the UAE and can assist you as below:
- BEPS Review – Analysing the impact of adopted BEPS standards;
- Tax treaty structuring and advisory;
- CRS advisory and compliance.