Introduction of Ministerial:
Ministerial Decision No. 82 of 2023, issued by the Ministry of State for Financial Affairs, delineates the criteria for taxable entities obligated to prepare and uphold audited financial statements as per Federal Decree-Law No. 47 of 2022, focused on the Taxation of Corporations and Businesses. This decision aims to bolster transparency and compliance within financial reporting, clarifying its alignment with Federal Decree-Law No. 42 of 2022, commonly referred to as the Corporate Tax Law.
The primary objective of Ministerial Decision No. 82 of 2023 is to identify the taxable entities mandated to prepare and maintain audited financial statements. These statements undergo scrutiny by relevant authorities to ensure accuracy and adherence to regulations. The following categories of taxable entities are subject to these requirements:
Entities with revenues exceeding AED 50 million during the relevant tax period are obliged to prepare and maintain audited financial statements, enhancing transparency in entities with substantial financial activities. Additionally, Qualifying Free Zone Persons (QFZP) fall under this mandate, irrespective of their gross revenue or net profits. These entities, operating within free zones, adhere to the same financial reporting standards as those outside free zones, ensuring consistency and uniformity across all entities.
What needs to be done?
For Qualifying Free Zone Persons (QFZP) seeking the benefit of 0% tax on Qualifying Income, maintaining audited financial statements is imperative. Regardless of revenue or profits, it is advisable to maintain financial statements as a basis for tax return filing, even if audit is not mandatory.
What can Excellence do to help?
Excellence boasts a team of dedicated Qualified Chartered Accountants ready to prepare and maintain your company’s proper book of accounts. We provide audited financial statements tailored to your company’s needs and offer professional financial advisory services. With our Client Service Team’s timely assistance, we ensure seamless coordination to address any concerns promptly.
- We promote transparency by maintaining clear visibility in daily operations.
- Ensuring compliance with pertinent legal and regulatory frameworks governing business activities..
- Identifying and proactively addressing potential risks that may pose threats to financial stability.
- Establishing uniform procedures to uphold consistency and trustworthiness.
- Streamlining resource allocation to enhance overall organizational efficiency.
- Preserving the accuracy and reliability of financial information while preventing fraudulent behavior.
