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Tax Accounting Services in Dubai, UAE

Tax auditing is typically the accounting performed for the tax-related purpose that follows the procedures to be done while filing a tax return. Consulting the right tax accountant in Dubai, UAE can help you prepare, analyse, and file tax returns in a seamless way, without committing any error. Just like bookkeeping and auditing services, tax accounting also plays a key role in the UAE economy. When it comes to tax accounting services in Dubai and UAE, CDA covers a whole range of tax services such as tax audit, tax return filing, etc to help business with their tax requirements.

accounting services in uae

UAE Tax Accountants

Tax accounting services provides the guidelines to be followed by individuals or businesses when they file tax returns. CDA tax accounting services in Dubai and UAE everything related to the UAE taxation including tax preparation, tax analysis, submission of tax returns and tax payments.

The UAE does not levy income tax on individuals. But, it levies corporate tax on oil companies and foreign banks. Excise tax is levied on specific goods which are typically harmful to human health or the environment. Value Added Tax is levied on a majority of goods and services. 

Tax is not a burden for the businesses, rather it acts as a mediator between the government and the end-users. So, the correct application of the tax will safeguard the company from booking input tax into wrong Accounts that will hit on the cost of the company. Application of Reverse Charge Mechanism in accounts, completion of VAT 201 form and proper closing of accounts related to tax in each period make Tax Accounts transparency.

UAE follows the accounting standards as per the International Financial Reporting Standards (IFRS). The Federal Tax Authority (FTA) of UAE has introduced the taxation system with the purpose to differentiate the regional economies and inflate UAE business internationally. 

Different Types of Taxes in the UAE 

  • Excise Tax
  • Value Added Tax
  • Taxes in tourist facilities

Excise Tax 

Excise tax is a form of indirect tax levied on specific goods which are typically harmful to human health or the environment. The following goods are coming under this category: -

  • Carbonated drinks include any aerated beverage except for unflavoured aerated water
  • Energy drinks include any beverages which are marketed, or sold as an energy drink, and containing stimulant substances that provide mental and physical stimulation.
  • Tobacco and tobacco products
  • Electronic smoking devices and tools
  • Liquids used in such devices and tools
  • Sweetened drinks.

Value Added Tax

Value Added Tax or VAT is a tax on the consumption or use of goods and services levied at each point of sale, that are mentioned below: -. 

  • Exempt supplies: -
    • The supply of some financial services that explained in VAT legislation
    • Residential properties
    • Bare land
    • Local passenger transport
  • Taxable supplies: -
    • Commercial property
    • Retail purchase
    • Car sales and rentals
    • Hotels and restaurants
    • Repairs and maintenance services
  • Zero-rated: -
    • Education
    • Healthcare
    • Medicine and Equipment, 
    • Investment in Gold, Silver, and Platinum, 
    • Exports and International Transports, 
    • Crude Oil and Natural Gases,
    • First Sale of Residentials. 

Taxes in tourist facilities 

Restaurants, hotels, hotel apartments, resorts, etc. in the UAE might charge tourist tax on room rate, service charge, etc. as shown below: -

  • 10 percent tax on the room rate
  • 10 percent service charge
  • 10 percent municipality fees
  • 6 to 10 percent City tax 
  • 6 percent tourism fee
  • In Dubai, hotels charge 'Tourism Dirham Fee' per room per night of occupancy (for a maximum of 30 consecutive nights) ranging from AED 7 to 20 depending on the category/grade of the hotel.
  • In May 2016, it was announced that hotels in Abu Dhabi would charge a new additional fee of 4 percent of hotel stay bill and AED 15 charges per night per room.
  • In Ras Al Khaimah, hotels charge AED 15 tourism fee per room per night.

Importance of Tax Accounting 

Tax payment is compulsory for any business in UAE as this revenue is used for the development of the country. Availing proper tax accounting services in Dubai ensures that your business complies with tax laws by filing tax returns. A single fault in the accounting process may lead to a heavy business loss. So, individuals or companies must be extra vigilant while preparing a Tax Account. The following tips will make clear the importance of Tax Accounting as ensures: -

  • To identify the tax payable position at regular intervals
  • For proper planning of tax
  • For the effective cash flow planning
  • Configuration of Tax Accounting into ERP Software
  • Proper accounting of tax will safeguard the company in front of government authorities with relates to the tax audit
  • Will increase credit-worthiness & goodwill in the market. 

Things to remember: -

  • It is the responsibility of everyone to pay regular taxes.
  • One should learn the tax rules and regulations for the business and update to avoid facing legal consequences. 
  • Ensure that you register for your taxes at the right time to avoid paying late fees and penalties.
  • Prepare documents related to your taxes and monitor them all the time.
  • Estimate the tax payments beforehand and prepare a budget for it to avoid falling short when filing time comes.
  • You must know proper computation to compute accurately and stop paying more than you should.

Why Tax Audit needed before each quarter tax filing 

  • For accuracy
  • For mistake-free
  • Exact VAT report by matching with internal financial records.
  • Give more authentication to Tax Filing Report

CDA Tax Accounting Services 

  • Advice on Tax Accounting
  • Preparation of balance sheets on the basis of tax 
  • Preparation of tax validation projects
  • Updating accounting laws for any changes and applying the same
  • Deals with tax risk
  • Filing of Tax Returns

Why Outsource Your Tax Accounting with CDA?

CDA has been providing its expert services to the business world for the last so many years fulfilling the needs of its clients with complete satisfaction. We can assist you to deal with the tax structure of your business in a better way. Outsourcing your tax accounting services with CDA helps you avail tailor-made tax solutions that suit your business entity in UAE. 

Our experts sort out the tax issues and prepare tailor-made solutions apt to the business entity based on its nature and the needs of the owner. Our Tax Accountants can give you advice on effective tax management and find ways to lower your tax payments. They can help you in filing Income Tax Returns and Audited Financial Statements. They can also renew your business permits and licenses for you and perform audits.

CDA Accounting & Bookkeeping Services LLC also professionally handle CFO Services, Auditing Services, Accounting & Bookkeeping Services, Accounting Software services, Due Diligence Services, and Tax Filing & VAT Consultancy services in Dubai on time according to the convenience of our good clients. We give priority to the maximum satisfaction of our clients. Our customer-centric approach is well appreciated, and we promise one of the best services to your business. 

So no more worries about tax accounting in Dubai. CDA is always there for your relief! 


Frequently Asked Questions on Tax Accounting Services

With the increase in the legal requirements of companies to take care of proper financial records, it has become even more important for each business to hire tax accountants. Tax accounting helps in timely filing of VAT returns and to maintain the financial transparency at the times of tax audit conducted by FTA.

Businesses that satisfy certain requirements covered under the Legislation (such as having an area of residence within the UAE and being related/associated parties) are going to be ready to register as a Tax group. For a few businesses, Tax grouping is going to be a useful gizmo that might simplify accounting for VAT.

VAT invoices issued and received must be preserved for a minimum of 5 years as it is mandatory by law.

CDA offers tailor-made solutions that suit the business entity supported the character of the business it's involved in. On-time delivery of solutions and projects is another important feature that we strictly follow and provided for our customer. We have a good range of satisfied clients globally handling different businesses.

It is essential all business must consider a well-designed plan for tax compliance and have the right accounting systems and procedures in place to ensure compliance with the tax laws and regulations in the region. The tax authorities have arranged an online compliance platform to streamline and assist businesses through the filing process.

The basic tax accounting procedures are (1) collection of the information’s of the suppliers and customers to the business, (2) tax coding of all the transactions, (3) sales and purchase accounting entries are passed, (4) monitoring of the General ledger, (5) tax recording and reporting to the management.

The Economic Substance Test activities are (1) assess the relevant activity performed during the financial period, (2) assess the income earned from the relevant activity during the financial period, (3) conduct board meetings as well as ensure the minutes are signed and maintained, (4) identify the number of full-time employees in performing the relevant activity, (5) identify the related expenses for performing the activity.

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