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The UAE Ministry of Finance (MoF) has announced a new Cabinet decision related to “qualified public benefit entities”, which are exempt from corporate tax.
A WAM report said the exemption was designed to recognize the important role played by public benefit entities, which include organizations focused on religion, charity, science, education and culture.
These entities must continue to comply with all relevant local, state and federal laws and notify the MoF of any changes that may affect their status as a qualified public interest entity in order to be eligible for the UAE corporate tax exemption. These entities must also meet the requirements of section (9) of the Corporations Tax Act.
cabinet privilege
On the advice of the Minister of Finance, Cabinet may change, add or remove entities from the list of eligible public benefit entities.
Any changes that affect a business’ ability to continue to meet the requirements outlined in this decision and the corporate tax law must be reported by the entity identified in the schedule attached to this decision.
Eligible public benefit entities need to meet several reporting requirements, primarily to ensure that they continue to meet approval requirements.
deductible expenses
With regard to deductible expenses under Section 33 of the Corporate Tax Act, there is now greater clarity and transparency for taxpayers thanks to the Cabinet decision that donations and gifts will be considered deductible expenses for corporate tax if given to one of the following persons listed in the Cabinet decision Qualified nonprofit entities.
The Corporate Tax Law provides the legislative basis for the introduction and implementation of federal corporate tax in the UAE and is effective for financial years commencing on or after 1 June 2023. Federal Decree No. (47) of 2022 on Taxation Companies and Enterprises Law was issued by the UAE on December 9, 2022. — trade arab news agency
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