The UAE Ministry of Finance has recently unveiled three new Ministerial Decisions, intended to bolster the implementation of Federal Decree-Law No. 47 of 2022 on the Taxation of Corporations and Businesses. These decisions include -
1. Ministerial Decision No. 114 of 2023, focusing on Accounting Standards and Methods
2. Ministerial Decision No. 115 of 2023, addressing Pensions and Social Security Funds
3. Ministerial Decision No. 116 of 2023, which pertains to Participation Exemption
According to His Excellency Younis Haji Al-Khoury, the Undersecretary of the Ministry of Finance, these three decisions have been formulated to foster greater flexibility within the UAE's corporate tax system. Moreover, their implementation is aimed at establishing a conducive business environment across diverse sectors.
The new Accounting Standards and Methods decision (No. 114 of 2023) is expected to provide clarity and consistency in financial reporting practices for corporations and businesses operating in the UAE. By adhering to standardized accounting procedures, companies will have a solid foundation for managing their financial affairs efficiently.
Ministerial Decision No. 115 of 2023 focuses on Pensions and Social Security Funds. This decision is set to streamline the regulations concerning pension schemes and social security funds, ensuring greater transparency and security for employees' retirement savings. The aim is to establish a robust pension framework that promotes employee welfare and long-term financial stability.
The third decision, Ministerial Decision No. 116 of 2023, pertains to Participation Exemption. This decision is expected to encourage investment and stimulate economic growth by providing tax exemptions on dividends and capital gains derived from certain qualifying investments. By implementing this exemption, the UAE aims to attract local and international investors, promoting a thriving business environment.
These new Ministerial Decisions are part of the UAE's ongoing efforts to refine and enhance its tax framework, reinforcing its position as a favorable destination for business and investment. The government's commitment to flexibility and support for various sectors underscores its dedication to fostering economic growth and prosperity within the country.
You can access Law including Guidelines, Cabinet & FTA Decisions, Public Clarifications, Forms, Business Bulletins for all taxes (Vat, Excise, Customs, Corporate Tax, Transfer Pricing) for all GCC Countries in the Law Section of GCC FinTax