Branches

Frequently Asked Questions

Yes, The revenue of UAE branches includes their UAE “parent’s” or “head office’s” taxable income and UAE CT return.

If no election is made or the revenue of the foreign branch or permanent establishment is not qualified for CT exemption, the UAE CT payable on the revenue of the foreign branch or permanent establishment can be lowered by the corporate tax paid on the relevant income in the foreign jurisdiction.

No, UAE branches of a domestic or international juridical person are extensions of its “parent” or “head office” and are hence not regarded as separate juridical entities.

No, they are not required to register or file for UAE CT separately.

Unless a UAE firm elects to claim an exemption for its international branch revenues, the income of its foreign branches or foreign permanent establishments will be included in the taxable income and UAE CT return of its UAE “head office.” This exemption applies to foreign branch profits that have previously been taxed in the foreign jurisdiction.

Unless the branch’s operations do not result in a permanent establishment in the UAE for CT purposes, a foreign company with a branch in the UAE would be subject to UAE CT in general.

  • Preparatory or auxiliary activities are those undertaken in preparation for or in support of the foreign entity’s more substantial business activity.
  • Storage, display, or delivery of goods or merchandise owned by a foreign business are examples of preliminary and auxiliary operations. Limited marketing and promotional operations, doing market research, and attending seminars or conferences are further examples.
  • When assessing whether a permanent establishment exists or whether the operations conducted are preparatory or auxiliary in nature, consider and take into account the application of a global agreement for the avoidance of double taxation.

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