IN
UAE
UK
USA
ESR
The United Arab Emirates (UAE) introduced a set of rules generally known as the Economic Substance Regulations (ESR) in 2019 to combat tax avoidance by multinational companies and increase transparency. The ESR applies to all mainland and free zone legal entities (Licensees) carrying on Relevant Activities. This alert summarises the main ESR requirements and sets out a reminder of important deadlines.
The ESR requires Licensees to demonstrate that they have a genuine economic presence in the UAE and that the activities they carry on are not solely tax driven. Licensees may be required to prepare and submit an economic substance notification and an economic substance report from 1 January 2020 onwards, on an annual basis.
Pursuant to the ESR, Licensees that carry on a Relevant Activity in the UAE that generates revenue/income (either a profit or a loss) must maintain an adequate presence in the UAE such as through having an adequate level of https://stratrich.com/assets or number of qualified employees. In addition, the strategic management decisions of the Licensee must be conducted in the UAE.
STRATEGIES
Customized ESR Compliance Support
We assist in aligning your company with ESR requirements, creating policies that suit your unique needs to minimize non-compliance risks
What are the Relevant Activities?
Any Licensee carrying on any of the below activities may be required to prepare and submit a Notification and potentially a Report to the Ministry of Finance.
Enquire Now
Banking business
Investment fund management business
Headquarter business
Holding company business
Distribution and service centre business
Insurance business
Lease-finance business
Shipping business
Intellectual property business