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UAE corporate tax: Technology to help businesses stay compliant – News

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Cloud-based accounting system helps companies automate tax calculations and generate tax reports



With the UAE introducing corporate tax from June 1, companies in the country are now focusing on bringing their tax obligations in line with the latest government regulations.

Technology has come a long way in helping businesses streamline the tax process and stay compliant. Cloud-based accounting systems help businesses automate tax calculations, generate tax reports in formats prescribed by the Federal Tax Agency (FTA), and help securely maintain accounting records and documents.

“These features enable businesses to reduce errors and the manual work required to maintain compliance. It also provides internal control features such as audit trails, access controls, and transaction approval workflows. This ensures complete transparency and data integrity, and ultimately Protect businesses from misuse of sensitive information,” Prashant Ganti, Head of Product Management, Zoho Finance and Operations Suite, told Khaleej Times. Furthermore, he added, good accounting software will help businesses automatically future-proof their business against any new government mandates that may be introduced.

Excerpt from the interview:

What is your vision for the future of tax compliance in the UAE?

As technology advances, the UAE is likely to see the use of tax filing automation, which will reduce manual errors and streamline the entire process. Additionally, as tax regulations continue to evolve, businesses may need to conduct ongoing reporting and proactively engage with tax authorities through real-time collaboration.

How will the new corporate tax regime in the UAE initiative affect businesses of different sizes and industries?

The new law will affect businesses of different sizes and industries differently. However, the government has taken this into consideration when implementing the law. Businesses with taxable income up to Dh75,000 will pay 0% tax and entities with taxable income over Dh375,000 will pay 9% tax.

Businesses with an annual revenue of less than AED 3 million can apply for the small business relief. In addition, qualifying entities in more than 30 free zones will enjoy a 0% tax rate. This relieves small businesses of some of the financial pressure and compliance burden. The development of key industries in the free zone will also be supported.

How Zoho helps businesses in the UAE to comply with the new corporate tax law?

When VAT was implemented in the country, we launched Zoho Books for UAE to help businesses meet their tax obligations. We recently launched the Business Tax feature in Zoho Books, enabling businesses to automate tax calculations and ensure accurate tax filings. In addition, corporate tax reports can be generated on the fly in the format to be introduced by the FTA. Not only does this simplify the tax filing process, but it also reduces the manual work involved.

Under FTA guidelines, businesses must also keep records and documents for seven years. Zoho Books allows businesses to securely maintain supporting documents and organize financial data in the cloud.

Overall, our aim is to provide UAE businesses with the tools they need to effectively navigate and comply with the new corporate tax regulations.

How does Zoho plan to facilitate continued compliance with future tax changes for businesses in the UAE?

Zoho is committed to future-proofing tax compliance services for UAE businesses. We are always aware of the latest government initiatives and ensure we support businesses with the appropriate capacity. Zoho Books rolls out continuous automatic updates on the backend without any disruption to our customers. In addition, we will continue to provide comprehensive resources such as guides, articles, FAQs, webinars and seminars to educate businesses on important tax updates. We also have a growing network of accountants and implementation partners who support businesses in establishing frameworks and processes for a smooth transition. Our clients find these initiatives helpful in navigating the ever-changing compliance environment.

With reference to the implementation of corporate tax, what impact does Zoho foresee on the UAE’s economic growth?

A corporate tax that meets OECD global standards is expected to have a positive impact on the country’s economic growth. Not only can it increase government revenue, it can also reduce dependence on a single sector and boost long-term growth.

Prashant Ganti - Head of Product Management - Zoho Finance and Operations Suite. - Photos provided

Prashant Ganti – Head of Product Management – Zoho Finance and Operations Suite. – Photos provided

Additionally, businesses are required by law to ensure compliance by maintaining accurate records and filing taxes and payments on time. This provides a higher level of transparency and accountability among businesses and may attract more investment, ultimately leading to economic growth.

Some businesses are not yet familiar with the new law and may not have the systems, processes and expertise required for tax compliance. What is your role in this?

We understand that businesses are still in the process of transitioning to the new law and may not have the necessary guidance needed to comply. That’s why we go beyond providing corporate tax features by providing a variety of resources to help businesses familiarize themselves with the new law. Our expert-led webinars, guides, FAQs and seminars provide a comprehensive overview of the regulations and their requirements to help businesses with a smooth transition.

To understand our customers’ readiness, we recently conducted a survey among Zoho Books users in the UAE. The results show that 44% of respondents are establishing frameworks to ensure compliance. More than 85% believe that understanding the law and its requirements can make it difficult to comply. This highlights the need for guidance among businesses, which helps us align resources to provide them with the necessary support.

What’s more, more than 80% of customers trust Zoho Books to help them meet their corporate tax obligations. Businesses can rest assured that any new regulations introduced by the government will be automatically handled by Zoho Books. They can rely on Zoho Books to simplify the tax compliance process and reduce manual steps.

Zoho Books suits businesses of all sizes by providing easy configuration of tax settings. Once businesses are registered with the Emara tax portal, they can enter their tax registration number, select the applicable percentage and filing date. The system automatically calculates the tax amount and generates a tax return. Our app is designed to simplify the compliance process for businesses of all sizes and will effectively help them meet their tax obligations.

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