Requirements of Financial Consultant Company for Compliance in UAE

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To run the business for the long term in UAE, a financial consultant company helps the companies to meet the law and regulations of the nation.




In the UAE, there are multiple regulations and compliance needs that must be followed by the firms in UAE and Dubai annually. These compulsory obligations act to make sure that your business is conducted in the right and orderly manner.





It is significant that you are aware, and up to date with the latest changes to regulations particularly those that will apply to your UAE entity, its shareholders, manager, and its employees. Consequences of non-compliance can outcome in certain financial fines, closure of bank accounts, businesses, and even imprisonment penalties.







What are the compliance requirements for business in UAE & DUBAI?





UAE TAX LAWS–


UAE for the most part is a tax-free economy. Corporate Income Tax (CIT) is presently only applicable to branches of foreign banks and oil and gas companies. From 1 June 2023, the corporate rate at a standard tax rate of 9% will be applied to all mainland business and commercial activities on taxable profits above AED 375,000. There is no personal income tax or withholding tax requirements.








The UAE brought Value Added Tax (VAT) on Jan 1, 2018.



VAT in the UAE is applicable for all registered companies irrespective of the fact that the business is a mainland or free zone company. The tax rate is 5% but some business activities are exempt from VAT or carry 0% VAT.





Your UAE business must register for VAT if it meets either of the following criteria:



  • The total value of the taxable supplies made within the UAE go above AED 375,000 over the past 12-month period.
  • The perspective is making taxable supplies with a value go above AED 375,000 within the next 30 days.
  • Your UAE business can also willingly register for VAT if its value taxable supplies go above AED 187,500.
Financial services compliance consultants assist businesses or organizations to understand their boundaries to keep their businesses in profit.

financial consultant company

AUDIT OF FINANCIAL RECORDS


For UAE mainland businesses, it is important to get the financial records audited. However, it is not required to submit the audited accounts with the charge in which they are registered.
For UAE free zone organizations, audit requirements depend completely on the jurisdiction of the free zone in which they are registered. UAE free zone companies may require to get their financial records audited and submitted to their respective free zone authority in the given time period specified by each governing free zone.









ECONOMIC SUBSTANCE REGULATIONS

The Economic Substance Regulations (ESR) in the UAE came in April 2019 (revised in August 2020). The ESR is in line with UAE’s commitment to global tax cooperation and transparency.

The regulations need UAE’s onshore organizations, free zone companies, and other businesses to reform that carry out any of the ‘Relevant Activities’ listed in the policed’ framework to keep an adequate economic existence in the UAE.

The following activities are reviewed as relevant tasks for the motive of ESR:



  • Banking business
  • Insurance business
  • Investment capital management business
  • Lease finance firm
  • Headquarters Company
  • Shipping trade
  • Holding company business
  • Intellectual property-related business
  • Allotment and service center business
Licenses that conduct an applicable pursuit must submit an economic substance warning within 6 months of their financial year-end. If needed, your UAE firm must also submit a profitable substance detail within 12 months of your financial year-end.


ULTIMATE BENEFICIAL OWNER (UBO)


All businesses whether registered in the mainland or free zone require to keep a UBO register or a register of shareholders. All shareholders holding, owning, or having the ability to manage and vote more than 25% of the share capital of the organization are considered Beneficial Owners (BO), as well as Nominee directors, are also considered to be BO.






ANTI-MONEY LAUNDERING & COUNTER-FINANCE TERRORISM


As per the UAE’s bids to further boost the transparency of businesses, the Anti-Money Laundering (AML) and Counter-Finance Terrorism (CFT) needs must comply. These needs are also part of the Know Your Client (KYC) purposes by banks to sustain your company’s bank account.






Financial services compliance consultants know each and every requirement of these laws and help SMEs to follow updated compliance laws smoothly.




Conclusion

For businesses in the UAE, it is not only vital to know some of the compliance needs but to also make sure that these requirements are properly contented in a timely manner to avoid penalties for your organization. Therefore, financial services compliance consultants have a team of professionals who come across these laws before anyone. Acquara Management Consultant is a financial consultant company helping businesses to avoid penalties by following compliance with the regulations of the UAE.


Location: Dubai - United Arab Emirates

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