BCCD finance experts explore challenges and opportunities of new UAE corporate tax system
A panel of experts convened by the British Chamber of Commerce Dubai (BCCD) has revealed some of the challenges and opportunities for businesses operating under the new UAE corporate tax system. Following recent updates to governing laws, the panel discussion explored a range of themes, including tax optimisation, boosting foreign investment, and streamlining processes for compliance.
Opening the event, Dr. Peter Wilson, Founder and Global Tax Advisor at PB First Global Tax, provided an overview of the updated regulations issued in the Ministerial Decision of December 2024, highlighting changes in tax grouping compliance compared to the Ministerial Decision issued in 2023. Dr. Wilson also discussed the scope of the recently introduced Domestic Minimum Top Up Tax (DMTT), as well as its provisions for refundable tax credits for R&D and high value employment activities.
Joining in the subsequent panel discussion were Shamma Al Falahi, Partner and Head of Tax at BSA LAW and former Federal Tax Authority Head of Tax Returns and Payments, and Martin Bradley, Group Chief Financial Officer of Dulsco Group. Moderated by Fazeela Gopalani, Partner at EY and BCCD Director of Finance, the conversation opened with a reflection on the legal considerations of the corporate tax system.
Sharing her expertise, Al Falahi discussed the opportunities for business to mitigate tax liabilities through exemptions and relief. She advised that organisations should explore international tax treaties to eliminate instances of double taxation and consider how entities and supply chains could be re-structured to achieve tax optimisation. Al Falahi recommended companies review their contractual arrangements and payment terms, particularly in relation to in-kind agreements.
Discussing some of the challenges of implementing the corporate tax system, Bradley explained how it can affect shareholder relations. He said, “The impact on dividend distribution means we have had to change the narrative to shareholders. Managing a 9% reduction in net profits requires strategic communication. We are seeing costs passed through the supply chain to recover tax through price increases, but this should be fractional; a 1% increase, not a 9% increase. We need to be properly armed with our commercial story.” Sharing Dulsco Group’s experience of ensuring compliance in a complex regulatory environment. Bradley added, “You need the right systems and the right expertise. We have automated the process, working backwards from the end requirements, ensuring we have the right people to interpret and implement the advice effectively.”
Reflecting on the broader implications of corporate taxation for the business landscape in the region, Dr. Wilson said that, implemented efficiently and transparently, the regulations could attract more inbound foreign direct investment. He remarked, “Aligning taxation with international practices brings clarity and comfort for investors. The current rate of 9% is competitive compared to other countries in the region, and if managed well, it can boost the UAE’s reputation as a global business hub.”
Convening over 80 delegates at Jumeirah Mina Al Salam Hotel, the UAE Corporate Tax Update was sponsored by One Space Business Center and marked the first of BCCD’s Business Briefing sessions for 2025. BCCD CEO, Katy Holmes, said, “Our business briefing series is an established platform for experts to reach our member companies to address market changes to support their understanding and reduce the risk to decision makers who are accountable for the adherence and implementation of any regulations. Whilst the UAE Corporate Tax is most relevant to larger companies, we do foresee that the full supply chain will be impacted.”
