Economic Substance Regulations

As part of the UAE’s commitment to the OECD Inclusive Framework and in response to an assessment of the UAE’s tax framework by the European Union Code of Conduct Group on Business Taxation, the UAE introduced a Resolution on the Economic Substance.

Economic Substance requires a licensee to prove the substance requirements are met in the UAE. To do so, a licensee is required to evaluate the regulations’ applicability on businesses and classifications.

Our team can ease out the process and help you with:

Preliminary Assessment:

We assist in identifying whether businesses fall within the scope of the economic substance regulations and evaluation of economic substance filings.

Core Assessment:

Every business needs to assess relevant activities stipulated in the regulations and implementing provisions to assess the reporting requirements, corporate governance, relevant substantiating records to meet substance requirements and reporting. Our professionals will advise you to fulfill these requirements while maintaining transparency and checking the tax return information submitted worldwide.

Gap Analysis:

Economic substance assessments require substantive proofs against the filling a licensee has made to avoid penalties of non-conformity reporting. Our team has extensive experience working with the assessments to find missing information in business vis-à-vis substance reporting.

Appeals and Litigation:

Should a licensee be levied with an administrative penalty due to late submission, incorrect submission or not meeting substance requirements in the UAE, we can assist you with submission of appeal and preparation of responses to National Assessing Authority.

Development of Corporate Governance:

A licensee is required to perform core income generating activities in the UAE with respect to each relevant activity and have decision-making in the UAE. We advise our clients in establishing corporate governance and preparation of notices, resolutions and register of shareholders through our secretarial services.