Currency
For the purposes of this Decree-Law, all amounts must be quantified in the United Arab Emirates dirham. Any amount quantified in another currency must be converted at the applicable exchange rate set by the Central Bank of the United Arab Emirates, subject to any conditions that may be prescribed in a decision issued by the Authority.
Calculation and Settlement of Corporate Tax
The Corporate Tax due under this Decree-Law is settled in the following order:
1. First, by using the available Withholding Tax Credit for the Taxable Person, as determined under Article 46 of this Decree-Law on VAT Registration..
2. To the extent there is a residual amount after Clause 1 of this Article, by using the Taxable Person’s available Foreign Tax Credit as determined under this Decree-Law.
3. To the extent there is a residual amount after Clause 2 of this Article, by using any credits or other forms of relief as specified in a decision issued by the Cabinet at the suggestion of the Minister.
4. To the extent there is a residual amount after Clause 3 of this Article, this amount of Corporate Tax Payable must be settled in accordance with Article 48 of this Decree-Law.
Withholding Tax
1. The following income shall be subject to Withholding Tax at the rate of 0% (zero percent) or any other rate as specified in a decision issued by the Cabinet at the suggestion of the Minister:
a) The categories of State Sourced Income derived by a Non-Resident Person as prescribed in the decision issued by the Cabinet pursuant to this Article, insofar such income is not attributable to a Permanent Establishment of the Non-Resident Person in the State.
b) Any other income as recommended by the Minister FTA online in a Cabinet decision.
2. The Withholding Tax payable under Clause 1 of this Article shall be deducted from the gross amount of the payment and remitted to the Authority in the form and manner and within the timeline prescribed by the Authority.
Withholding Tax Credit
1. If a Person becomes a Taxable Person in a Tax Period, the Person’s Corporate Tax due under Article 3 of this Decree-Law can be reduced by the amount of Withholding Tax Credit for that Tax Period.
2. The maximum Withholding Tax Credit under this Decree-Law is the lower of:
a) The amount of Withholding Tax deducted under Clause 2 of Article 45 of this Decree-Law.
b) The Corporate Tax due under this Decree-Law.
3. Any excess Withholding Tax Credit for a Tax Period as a result of Clause 2 of this Article shall be refunded to the Taxable Person in accordance with Article 49 of this Decree-Law.
Foreign Tax Credit
1. Corporate Tax due under Article 3 of this Decree-Law can be reduced by the amount of Foreign Tax Credit for the relevant Tax Period.
2. The Foreign Tax Credit under this Decree-Law cannot exceed the amount of Corporate Tax due on the relevant income.
3. Any unutilised Foreign Tax Credit as a result of Clause 2 of this Article cannot be carried forward or carried back.
4. A Taxable Person shall maintain all necessary records for the purposes of claiming a Foreign Tax Credit.
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