PRIVATE CORPORATE
TAX CLARIFICATION

What is the purpose of corporate tax clarifications?

Through its corporate tax clarifications, the FTA aims to guide taxpayers on tax legislation and their accurate application to the facts outlined in the application. The FTA provides an answer based on the facts stated in the corporate tax clarification application, but the authority will not verify such facts and will rely solely on the information provided by the applicant.

Application of FTA’s Tax Clarifications

The FTA’s Corporate Tax clarifications apply only to the applicant and the specific transaction or transactions for which the clarification request has been submitted.

The clarification should not be applied to other persons for materially different transactions.

Conditions to Submit a Tax Clarification Request

You can submit a corporate tax clarification request to the FTA if you meet the following conditions:

• The tax registrant is uncertain about the answer even after analyzing the relevant tax law and regulations, and the publications by the FTA
• The applicant has an interest in the matter
• The tax matter is not addressed in any of the previous clarifications issued by the FTA

Grounds for Rejection of Clarification Request

The FTA will reject a corporate tax clarification request under the following conditions:

• Incomplete or inaccurately filled application form
• The clarification request lacks clarity
• The FTA has issued a previous clarification to the same person on the same matter
• Submission of request by a person who is not the authorized signatory
• Seeking tax clarification about corporate tax transactions that the UAE government considers as tax avoidance schemes or tax planning advice
• The clarification request is related to a tax inspection, audit, or assessment by the UAE FTA

Which persons in the UAE can file a tax clarification request?

The following persons can submit a corporate tax clarification request to the FTA:

• The person seeking the tax clarification
• A registered tax agent in the UAE appointed by the person
• A legal representative appointed by the person

How to file Tax Clarification Requests with the UAE FTA?

Taxable persons or businesses in the UAE can submit corporate tax clarification requests through FTA’s Emara Tax platform. FTA allows businesses to appoint a registered tax agent in the UAE to submit the application on their behalf. Tax Gian can help you file tax clarification requests in a prescribed form alongwith required documents.

Documents Required for Filing Clarification Requests

Tax Gian can help you prepare and submit the documents required to file clarification requests with the FTA. Our UAE tax consultants team can verify the documents and submit them to the FTA along with the application form.

Typically, the following documents are required to submit a tax clarification application:

• Documents supporting factual and legal grounds such as sample invoices, contracts, payment slips, or other documents
• A letter stating details of the facts, legal references, technical view, and any alternative tax treatment
• Tax advice received (if any)
• A cover letter

Fees for Filing Tax Clarification Requests

You need to submit a fixed amount as fees for filing the clarification requests. These fees are generally non-refundable. The onus is, on the applicant to ensure that only valid, correct and complete applications are submitted. Tax Gian can help you make the payments to the FTA. The following are official fees for clarification requests:

• AED 1,500 per application for one tax
• AED 2,250 per application for more than one tax for same transaction (VAT, Excise Tax, Corporate Tax)

Timeline for FTA’s Response to the Request

FTA may take up to 50 business days to issue a Clarification. It may take longer if the FTA request additional information or documentation. You can contact our tax consultants in Dubai if the FTA is demanding additional information. Our consultants can review your documentation and assist in the resubmission of documents. Then, the new timeline will be 50 days from the date of furnishing additional information.

Implementation and Validity of Clarification issued

The FTA shall be administratively bound to implement the clarification where the factual circumstances and provisions remain unchanged as contained in the Request. The taxpayer can rely on the clarification for determination of taxability and penalties.

The Clarification will remain valid till the time it is withdrawn by FTA or any specific validity is prescribed or the relevant legislation is amended by FTA, basis on which Clarification is issued.

Refund of Service fees / Request fees for Non Issuance of private Clarification

FTA in a recent Decision issued, elaborated the instances where FTA decides not to issue Clarifications and fees paid for the same can be partially or fully refunded to the applicant. Also if the applicant withdraws the request within two business days from the date of submission, fees can be refunded.

Our Role in Providing Tax Clarification Services

Tax Gian is a tax consultancy firm located in Dubai that provides the following types of assistance related to tax clarifications:

• Review of the background of the matter in hand
• Assessment of potential technical positions, based on the tax laws and guidance
• Drafting of the corporate tax clarification request
• To verify that the Request contains all relevant information for the Authority to determine the response to that Request
• We can help you submit the request through a Form to the FTA through the EmaraTax platform

Why Hire Tax Gian’s Corporate Tax Services

• Tax Gian, headquartered in Dubai, is one of the best corporate tax consultants.
• Our associate JTC is a registered tax agent approved by the UAE FTA
• We have more than two decades of experience in the UAE as accounting, audit and tax service providers
• We have a dedicated team of tax experts
• Tax Gian has experience in various industries and sectors

Frequently Asked Questions

1. What types of requests do not come under clarification?

• Reconsideration request
• Administrative penalty waiver request
• Administrative penalty payment by instalment request
• Special Input Tax Apportionment method request
• Administrative exception request
• System technical enquiries
• Other matters not pertaining to the interpretation of the relevant tax law in the context of specific facts

2. Can I dispute a clarification issued by the FTA?

Clarifications are not subject to the dispute resolution process. It means you cannot submit a reconsideration or a review of the clarification issued by the FTA.

3. What are the circumstances in which the FTA will extend the issuance of clarification?

• If additional information or documentation is required
• If the case is relatively complex