38 Corporate tax

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Corporate tax

On 9 December 2022, the UAE Ministry of Finance (“MoF”) released Federal Decree-Law No 47 of 2022 on the Taxation of Corporations and Businesses, Corporate Tax Law (“CT Law”) to implement a new CT regime in the UAE. The new CT regime is applicable for accounting periods beginning on or after 1 June 2023. As the Group’s accounting year ends on December 31, the first tax period is from January 1, 2024 to December 31, 2024, with the respective tax return to be filed on or before September 30, 2025.

The tax rate applicable in the UAE is 9% (2023: 0%) per annum for taxable profit exceeding AED 375,000. The overall effective tax rate for the Group is 9.31% (2023: 0%) per annum.

The difference between the applicable tax rate and the Group’s effective tax rate arises due to various adjustments being made in accordance with the corporate tax law which are stated below:

 

2024  2023
AED ‘000  AED ‘000
     
Profit before tax 8,257 –
Prima facie tax expense at 9% (2023: 0%) 743 –
Tax effect of difference:
Tax effect of exempt income (827) –
Tax effect of non-deductible expense (94) –
Tax effect of different tax rate of subsidiaries operating in foreign jurisdiction – –
Changes in deferred tax – –
Unrecoverable withholding tax – –
Others (due to the tax deductible of subsidiaries not included in the tax group) 947 –
Tax expense for the year 769 –

 

 




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