2023-05-01 10:08:54
(24 News) The Ministry of Finance of the United Arab Emirates has announced tax concessions for small and micro businesses, start-ups and freelancers under corporate tax.
There is good news for small business people from the United Arab Emirates that there will be tax concessions for small businesses under corporate tax. Business tax is being implemented in the UAE from June 1, 2023. Under Ministerial Decision No. 73 for the year 2023, businesses and individuals with revenues of 3 million dirhams or more can benefit from the “Small Business Relief” initiative, which aims to reduce the corporate tax burden on start-ups and other small businesses. To help them by reducing their expenses. The UAE government announced last year that it is imposing a corporate tax rate of 9% on companies earning more than 375,000 dirhams.
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The Ministry of Finance has said that the income limit of 3 million dirhams will apply to tax periods beginning on or after June 1, 2023 and only to tax periods ending on or after December 31, 2026. . Under this initiative, those whose income is less than 3 million dirhams in the tax period and previous tax period and who are residents of the emirate can claim “Small Business Relief”.
According to the decision of the Ministry of Finance, businesses that are not covered by Small Business Relief will be able to carry forward (carry-forward) their tax losses in a tax period to future tax periods. If a taxable person has artificially separated himself from his business or its activities and the total income exceeds 3 million dirhams in any tax period during which the person applies for “Small Business Relief”, he/she can shall be deemed to be in violation of sub-clause 1 of Article 50 of Corporate Tax.
The Emirati Ministry of Finance has further stated that qualifying free zone individuals or multinational business entities operating in more than one country with a group revenue of more than 3.15 billion dirhams will not be eligible for this exemption.
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