Cabinet Decision No. (74) of 2023 was issued on 28 July 2023 on the Executive Regulation of Federal Decree-Law No. (28) of 2022 on Tax Procedures.
Cabinet Decision No. (75) of 2023 On the Administrative Penalties for Violations Related to the Application of Federal Decree Law No. (47) of 2022 on the Taxation of Corporations and Businesses was also issued.
Key Takeaways –
Keeping Records
Kaizen provides tax consultancy services in Dubai UAE to assist companies in keeping records. Accounting records and commercial books shall include the following:
Records and books in relation to Business, which evidence or in which payments and receipts, purchases and sales, revenues and expenditures are recorded, as well as any matters as may be required under the Tax Law or any other applicable law, including but not limited to:
- Balance sheet and profit and loss accounts.
- Records of wages and salaries.
- Records of fixed assets.
- Inventory records and statements (including quantities and values) at the end of any relevant Tax Period and records of stock counts related to inventory statements.
All documents supporting the entries in the accounting records and commercial books like Correspondence, invoices, licences and contracts related to the Business
Period of Record Keeping
All accounting records, commercial books and information shall be retained and maintained in a way that enables the Authority to verify the Tax obligations imposed on the Person concerned for the following periods:
- A period of 5 years following the Tax Period to which they relate in respect of a Taxable Person.
- A period of 5 years from the end of the calendar year in which the concerned document was created in respect of all Persons other than Taxable Persons.
- A period of 7 years from the end of the calendar year in which the concerned document was created for real estate records.
Method of Keeping Accounting Records and Commercial Books
The obligation to keep accounting records and commercial books shall be met by either:
- Creating a record and retaining the original documents which support the entries contained in the record.
- Creating a record and retaining the information contained in the original documents, where the information is:
- identical to the data contained in the original document
- retained or stored in an easily readable photocopy or electronic copy
- retained or stored in a manner that enables the Authority to verify the Person’s Tax obligations.
To make the process of recording hassle-free, Kaizen offers tax consultancy services in Dubai, UAE.
Table of Violations and Administrative Penalties Annexed to Cabinet Decision No. (75) of 2023
Sr. No. | Description of Violation | Administrative Penalty Amount in AED |
1 | Failure to maintain the required records and information |
|
2 | Failure to inform the Authority of any case that may require the amendment of the information pertaining to his Tax record |
|
3 | Failure to submit a Tax Return within the timeframe specified in the Corporate Tax Law |
|
4 | Failure to settle the Payable Tax | A monthly penalty of 14% per annum, for each month or part thereof, on the unsettled Payable Tax amount |
5 | Submission of an incorrect Tax Return | 500, unless the Person corrects his Tax Return before the expiry of the deadline for the submission of the Tax Return according to the Corporate Tax Law. |
If you require further information/ clarification we provide Business Consulting services in Dubai UAE. Our tax expert team will be happy to assist you.
Views expressed by Kaizen Business Consultants are not binding on any authority or court, hence no assurance is given that a position contrary to the opinions expressed herein will not be asserted by any authority or a Court of law. Further, unless specifically requested and agreed, we are not obligated to update the suggestions made herein for subsequent changes or modifications to the law, to the rules/ regulations, or to the judicial and administrative interpretations thereof.
