Accounting Law in Dubai
Updated on Sunday 01st March 2020
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Dubai is one of the most fascinating business destinations, as the UAE authorities have generated a great commerce background for the most developed industries around the world. Foreign investors who want to open a company in Dubai should know that it is wise to hire an accounting firm in Dubai, which can offer accounting and auditing services in agreement with the Dubai accounting law.
Financial reports in Dubai
Financial reports are mandatory for any kind of company with establishments in Dubai. Here is what you need to know in this direction:
- All businesses listed on the Dubai Financial Market (DFM) are obliged to publish IFRS (International Financial Reporting Standards) financial declarations.
- All enterprises listed on NASDAQ Dubai (previously the Dubai International Financial Exchange, DIFX) need to publish IFRS financial statements.
- All banks in the UAE are required by the Central Bank of UAE to announce IFRS financial statements.
- Although IFRS is not necessary for listed corporations other than banks, it is believed to be the best practice for these businesses to assume IFRS.
Audits in Dubai
In relation to the local legislation available in Dubai, businesses with operations set up here are demanded to perform audits, which represent a process demonstrating that the activities carried out by the business respect the requirements of the Commercial Law. Simultaneously, the audit procedure brings up the actions carried out by the auditors, who will authenticate if the business’s official papers can attest to its current financial condition. If you need to perform an audit, our accountants in Dubai can offer you proper services in this domain, in order for you to respect the UAE rules and regulations. The audit is done under the International Financial Reporting Standards (IFRS) and can provide the real financial situation of a business in Dubai and will identify areas that are exposed and will offer proper measures to adjust such fields.
Any particular errors or problems related to the management structure can be revealed by an audit report which is normally made in complete transparency. The vulnerable sectors in your firm can be detected with the help of an audit in Dubai. More than that, there can be solutions implemented after an audit report is issued, in order to optimize the business from numerous points of view. One of our accountants in Dubai can perform audits for your firm in Dubai, with respect to the rules imposed by the State Audit Institution of the UAE, the main audit authority.
Choosing an experienced accountant in Dubai
An accountant in Dubai must make proof he/she is a Certified Public Accountant and has experience in all accounting matters. Transparency and clarity are two important attributes that need to describe the work of an experienced accountant in Dubai. Bookkeeping, payroll, audits, management reporting and the preparation of annual financial statements enter the attributes of an accountant in Dubai. If you need to externalize the accounting services for your company in Dubai, feel free to talk to one of our specialists. Our accounting firm in Dubai can be the proper solution for your business needs in this city.
Accounting reports in Dubai – What you need to know
Companies with activities in Dubai must provide the annual activity report to the Ministry of Finance in Dubai, if trading companies are involved, or to the Ministry of Industry if we talk about industrial companies in the UAE. According to the Accounting Law in Dubai, this important procedure is related to the renewal of business licenses and permits in Dubai. We mention that the Ministry of Economy is the accounting regulation body in the UAE. As for the companies listed on the stock exchange, these are obliged to submit the accounts to the Emirates Securities and Commodities Market Authority in the UAE.
How is the tax year calculated in Dubai?
The tax year for companies in Dubai starts from the 1st of January and ends on the 31st of December. The annual financial statements and balance sheet need to be prepared for submission with the entitled authorities in the UAE.
Bookkeeping in Dubai
Bookkeeping is the process through which all the daily transactions of a company are recorded and kept. This is also the first step related to accounting regulations and the starting point of a business with financial operations. Effecting payroll, the issuance of invoices, the records of all the financial transactions are among the bookkeeping services an accounting firm in Dubai can provide for your company established in Dubai. It is important to have the support of an accountant when developing a business in Dubai, and our main target is to act in complete transparency and respect to the applicable laws in the UAE. We can provide bookkeeping services on request.
Can I use tax minimization methods for my company in Dubai?
Yes, according to the Accounting Law in Dubai, company owners can think of tax minimization methods for their businesses and cut the amount of taxes that need to be paid. Even if Dubai is a tax haven, there are also types of businesses where tax minimization tools are needed, like in the case of companies established in the banking sector or oil & petroleum. Among the useful tax minimization methods, setting up a donation can be extremely efficient. Paying credit loans in advance or creating a retirement plan might also represent ideal tax minimization methods. Feel free to discuss to one of our accountants in Dubai and find out more about the available tax minimization methods for your business in Dubai.
Making investments in Dubai
Dubai is one of the largest FDI recipient in the world, and a top business destination when it comes to businesses and company development. The financial sector, alongside IT & telecommunication, engineering, automotive, tourism, and innovative sectors are quite appealing to international players who direct their investments on a yearly basis. Here are some interesting facts and figures about the economy in the UAE:
- The UAE ranks 16th out of 190 economies in the world, according to the 2020 Doing Business report, issued by the World Bank;
- Around USD 140,000 million was the total FDI stock for UAE in 2018;
- Investors with companies established in Dubai’s free trade zones benefit from 100% ownership in the firm;
- India, the UK, Saudi Arabia, and France are among the main investors of the UAE;
- The repatriation of profits is not subject to taxation in the UAE, solid business advantage for foreigners.