UAE CT Law and MOF Decision 82: Who Needs to Maintain Audited Financial Statements?
The UAE Corporate Tax Law, also known as the UAE CT Law, states that a person’s taxable income should be determined using their financial statements that follow accepted accounting standards.
Recently, the UAE Ministry of Finance (MOF) issued Ministerial Decision No. 82 of 2023, which outlines the individuals or entities required to prepare and maintain audited financial statements.
Those who must maintain audited financial statements include:
- A taxable person deriving revenue exceeding AED 50 million during the subject tax period
- A qualifying free zone person
This is one of the key decisions of the corporate tax law and it depicts the UAE’s commitment to ease of doing business. A higher threshold of AED 50 million in revenue for audited financials, will give enormous compliance relief to small and medium enterprises. If forming a tax group, it is of utmost importance that every member of the group must maintain standalone financial statements. We would recommend that even if audit is not applicable it is better to maintain financial statements as that will act as a base for tax return filling and audit by the FTA.