United Arab Emirates - MOF issues guidance on audited financial statements and PEs

The UAE Ministry of Finance published two decisions on 28 April, one on audited financial statements and the other on permanent establishments (PEs) and the other on audited financial statements:

  • Ministerial Decision No. 82 specifies that persons deriving annual revenue exceeding AED 50 million and qualified free zone persons must prepare and maintain audited financial statements.
  • Ministerial Decision No. 83 sets out the conditions under which the temporary and “exceptional” presence of an individual in the UAE would not create a PE for a nonresident. The decision also lists exceptional events and situations that are beyond the control of the individual:
    • Public nature: e.g., the adoption of health measures by the authorities, travel bans, terrorist attacks, acts of war, natural disasters and the imposition of legal sanctions on the individual; and
    • Private nature: e.g., emergency health conditions affecting the individual or their relatives or events of a similar nature.

As per the decision, the Federal Tax Authorities can also prescribe other similar circumstances for this purpose.

Ashish Athavale
Brian Conn
Mufaddal Safdari
BDO in United Arab Emirates

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