In recent times, there have been massive changes in the fiscal and monetary environment of the UAE. For instance, two new tax systems are now applicable in the region, i.e., value-added tax and corporate tax. The introduction of new taxation in the UAE not only requires a change in calculation but also an increase in tax liability. These new taxes necessitate a significant shift in the overall economy. For instance, there is now a growing need for specialised accounting services. As Dubai is the business hub of the UAE, we expect a higher demand for accountancy services, including tax consultancy.
The Need for Specialised Accounting Services in Dubai
To find the answer, we are shedding light on the reasons that contribute to an increase in the financial and accounting services. Let’s discuss a few of them.
Adjusting to Complex Tax Regulations
The introduction of Corporate Tax and Value-Added Tax (VAT) has significantly increased compliance responsibilities for businesses. As a result, companies are now accountable for a broader range of obligations, including the following:
a) Maintaining proper books of accounts and maintaining documents for a specified time (e.g., seven years as per corporate tax law).
b) Tax registration within the stipulated timelines.
c) Tax filing and payment of tax liabilities.
d) Applying complex rules such as transfer pricing.
e) Getting updated with changes in the tax regulatory environment. This will help in claiming tax relief where possible. Therefore, outdated information will result in a loss.
In addition to these requirements, businesses in Dubai now face a growing list of compliance obligations. As such, partnering with a specialised accounting firm has become essential, not just an added benefit, but a business necessity.
Dubai: Home to Diversity
Dubai’s status as a global business hub is reflected in its diverse range of industries—from construction and hospitality to retail and professional services. Each sector comes with its own financial complexities and accounting standards. Engaging an experienced accounting firm with industry-specific expertise offers significant advantages: enhanced compliance, reduced risk of penalties, and more informed financial decision-making. A tailored approach to tax planning and sector-specific strategies ultimately contributes to stronger financial performance and long-term business health.
Audit Requirements
In the UAE, the introduction of new taxes demands higher transparency and accountability. Therefore, some businesses must have an annual external audit. Only a qualified accountant with specified years of experience can conduct an audit. Furthermore, there is also an internal audit. Some businesses have a permanent department that enables them to conduct internal audits. However, some firms do not have a permanent department; therefore, they hire a third-party service for internal audit. In both cases (external and internal audits), it is evident that there is a need for specialised accounting services in Dubai and the overall UAE.
Free Zone vs. Mainland Accounting
There are some changes in tax rules and accounting depending on the location of a business. For instance, businesses operating in the mainland are usually subject to standard corporate tax rates. However, a free zone entity may be subject to tax relief if they are a qualified free zone person. To qualify as a qualified free zone person, there are certain conditions to satisfy. A theoretical knowledge may not be enough to claim relief; therefore, we need expert knowledge. Thus, firms are now more dependent on expert accounting services such as CZTA.
Dubai: Home to International Businesses
As Dubai is a global centre of business, firms operating in Dubai have cross-border transactions. This is usually not as simple as we say. For instance, overseas transactions have tax impacts; therefore, there is a need to understand double taxation treaties. Furthermore, there can be compliance matters concerning transfer pricing and related party transactions. In addition to that, transactions need adjustment concerning the currency translations. Thus, there is a need for an expert to handle the complexities in a way that results in the smooth running of a business.
Conclusion
Undoubtedly, the need for specialised accounting services in Dubai has risen sharply. There are several reasons for this; however, in our blog, we discussed a few of them. Firstly, the introduction of new tax systems demands expert knowledge and experience to handle tax matters efficiently. Secondly, we have diverse business sectors and industries in Dubai. These need sector-specific knowledge and experience. Thirdly, some firms may be subject to a statutory audit, which can only be conducted by qualified accountants. Fourthly, differences in mainland and free zone entities also need seasoned knowledge and experience to claim reliefs. Lastly, as a home to international businesses, there is a need for specialized accounting services for Dubai businesses.
Creative Zone Tax & Accounting (CZTA)
As a licensed firm, CZTA provides services from basic bookkeeping to advanced-level tax planning and optimisation. Our tailor-made services aim to provide a remarkable experience to our clients. If you need any service related to accounting, compliance, tax, or audit, contact us today.
