UAE CT: Understanding Interest Capping & Deduction Limitation Rules (Article 30 & 31) скачать в хорошем качестве

UAE CT: Understanding Interest Capping & Deduction Limitation Rules (Article 30 & 31)

The UAE's corporate tax landscape continues to evolve, and in this video, we take a deep dive into two critical provisions: Interest Capping and Interest Deduction Limitation under Articles 30 & 31 of the UAE Corporate Tax (CT) Law. These new regulations, aimed at enhancing compliance and aligning with global standards, will significantly affect how businesses calculate and manage their interest expense deductions. 📈 What You'll Learn in This Video: Overview of Articles 30 & 31: We break down the core concepts of these two provisions, explaining how the new interest capping and deduction limitation rules will be applied to businesses in the UAE. Interest Capping Explained: Understand the specific limits on the amount of interest that can be deducted, based on various criteria such as a company’s earnings, financial structures, and debt-to-equity ratios. Deduction Limitation Rules: Learn the new criteria for determining what qualifies as deductible interest. This section explains the intricate details of the rules that restrict how much interest businesses can deduct from their taxable income. Impact on Business Financials: Gain insight into how these new rules will directly affect your business’s profitability, tax liabilities, and overall financial planning. Practical Examples and Case Studies: Through real-world examples, we illustrate how these rules will apply to various business models, providing a clear understanding of how to navigate the new tax landscape. Tax Efficiency Strategies: Discover strategies for businesses to remain tax-efficient under these rules. We cover the best practices for structuring debt and financing arrangements to maximize allowable deductions and minimize overall tax burdens. Compliance and Penalties: Learn about the importance of compliance and the potential consequences of failing to adhere to these new regulations, including penalties and adjustments. International Tax Implications: For multinational companies, we explore how these provisions affect cross-border transactions, interest allocations, and the impact of international tax treaties. Government Perspective: Understand the UAE’s broader tax policy goals and how these rules fit into the government’s efforts to create a fair, transparent, and sustainable tax system for businesses. 🌍 Who Should Watch This Video? Business Owners: If you run a business in the UAE, this video will help you understand how the new corporate tax rules affect your financial planning and tax compliance. Finance and Accounting Professionals: Accountants, tax advisors, and CFOs will benefit from a detailed breakdown of the interest capping and deduction rules, helping them advise clients or manage their company's tax filings effectively. Multinational Corporations: If your business operates in multiple countries, this video will help you navigate the complexities of UAE tax regulations and their impact on international financial structures. Tax Consultants: Stay informed on the latest corporate tax developments and ensure you're providing your clients with the best advice to stay compliant. Article 30 of the UAE CT law states that taxable can claim a net interest maximum of thirty per cent of adjusted Earnings Before Interest, Tax, Depreciation and Amortization (EBITDA) during a tax period, and the remaining net interest amount will be carried forward for a further period of ten years. However, if the net interest amount is below the threshold specified by the Minister, then the interest capping provisions will not apply, but the whole amount of net interest will be claimed by the taxable person. The word net interest is excess of net interest over interest income. While calculating EBITDA, exempt income will not be included. Similarly, any interest expense or income related to the exempt income will also not be considered while calculating the net interest amount. If a loan is acquired from a related party to finance income that is exempt from CT, interest on such loan from the related party will not be deductible unless the taxpayer can demonstrate that the primary purpose of obtaining the loan and carrying out the transaction is not to gain a CT advantage. For example, interest on a loan taken from a related party to pay the related party for dividends, profit distribution, the redemption of or contribution to share capital or acquisition of ownership interest in a person who is or becomes a related party following the acquisition. No CT advantage shall be deemed to arise if the related party (lender) is liable to pay a nine per cent or higher tax rate on the interest income earned. If the interest income in the hands of the lender is not subject to at least nine per cent tax, any interest paid to the related party will only be considered a deductible expense if there is a commercial reason.