ESR- listing the companies to be focused

The European Union had an analysis on tax submission methods of UAE Dubai, and after they concluded that their tax auditing standards are meeting. Based on that European Union have been listed UAE in EU Blacklist. Subsequently UAE needs to remove the name from EU Blacklist so that UAE has introduced Economic substance regulations(ESR).

Which are companies need to worry about ESR?

The introduced ESR rules are applicable to some companies doing certain works. Also some authorities like DMCC, DAFZA, DWC has requested every firms to reveal whether they are coming under those works or not. As per the Cabinet Resolution No. 31 issued on April 30, 2019, here listing the platforms:

1. Banking sector,

2. Insurance sector,

3. Investment Fund Management sector,

4. Headquarters sector,

5. Holding Company sector,

6. Shipping sector,

7. Lease Finance sector,

8. Intellectual Property sector

9. Distribution and Service Center sector.

substance over form should be considered to understand whether you are coming under above list. Also the companies have their own trademark,patents etc are considered as performing intellectual Property (IP) business.

You do not want to worries about ESR if you have

A company outside UAE,Dubai
You do not have interest on Loans
You do not have income from loyalty,franchise etc

But those companies come under the category must go for economic substance regulations. If you fail to do so then you may get a fine ranging from AED 50000 to 300,000

If you are searching for an accounting consultancy in the United Arab Emirates Dubai which will help your firm and submit an Economic Substance Notification accordingly, then you must come to the services of AGX accountants. We will help you with ESR notification submission till the final stage.