What accounting standards apply to UAE businesses?

UAE businesses are required to prepare financial statements compliant with IFRS (International Financial Reporting Standards). This applies to mainland companies, free zone entities, and branches of foreign companies. Since the introduction of UAE Corporate Tax in June 2023, IFRS-compliant accounting records are also required for CT compliance.

What is UAE Corporate Tax and how does it affect bookkeeping?

UAE Corporate Tax (CT) at 9% applies to taxable income above AED 375,000 for financial years starting on or after 1 June 2023. CT compliance requires IFRS-compliant accounting records, correct tax period identification, and proper treatment of exemptions (qualifying free zone entities, small business relief). Bookkeeping must track CT-relevant income and expenses separately from VAT.

Can a firm based outside UAE manage UAE bookkeeping?

Yes. UAE accounting and bookkeeping can be managed remotely using cloud software. Khetanca manages UAE business accounting in Zoho Books and QuickBooks — VAT, corporate tax tracking, WPS payroll, multi-currency and IFRS-compliant monthly close — for mainland and free zone businesses across all UAE emirates.

What is WPS payroll in the UAE?

WPS (Wages Protection System) is the UAE Ministry of Labour system that requires employers to pay salaries electronically through an approved exchange house or bank. WPS compliance requires a SIF file generated from payroll software each month. Khetanca prepares WPS-compliant payroll and the SIF file for UAE businesses.

UAE Accounting Services

UAE accounting.
IFRS, VAT and Corporate Tax — handled.

Outsourced accounting for UAE mainland and free zone businesses. IFRS-compliant bookkeeping, VAT returns filed with the FTA, UAE Corporate Tax tracking, WPS payroll and monthly management accounts — in Zoho Books or QuickBooks. Remote team, UAE-qualified work.

Talk to us → Zoho Books for UAE

IFRS-compliant monthly close

Financial statements prepared under IFRS. Balance sheet, P&L and cash flow by day 5 of each month.

VAT returns filed with FTA

Quarterly VAT return prepared and filed. Standard rated (5%), zero rated, exempt and out-of-scope transactions classified correctly. Input tax recovery maximised.

UAE Corporate Tax tracking

Taxable income tracked separately. CT provisions calculated monthly. Small business relief and qualifying free zone exemptions applied where applicable.

WPS payroll — SIF file monthly

UAE payroll processed and WPS SIF file generated monthly. Gratuity provisions calculated per UAE Labour Law. End-of-service benefits tracked from day one.

Multi-currency — AED, USD, GBP, EUR

Transactions in any currency recorded correctly. FX gain/loss tracked. Consolidated reporting in AED with comparative columns in functional currency.

What actually goes wrong

The pattern we see in almost
every UAE business we take over.

✕Books kept on a cash basis for years, then Corporate Tax arrives and every prior period needs restating to accrual IFRS before the first CT return can even be prepared

✕VAT applied at a flat 5% to everything, including zero-rated exports and exempt supplies, quietly overpaying VAT for years with no one noticing

✕A free zone company assumes it automatically gets 0% Corporate Tax, without ever confirming Qualifying Free Zone Person status against its actual income sources

✕UBO declarations and licence renewals filed as an afterthought, discovered only when a bank or free zone authority flags the business as non-compliant

✕WPS salary files rejected because payroll and HR records were never actually connected, so what gets submitted does not match what the labour contract states

✕Multi-currency transactions recorded at whatever exchange rate felt right that day, instead of a consistent FX policy — audit and CT filings then do not reconcile

UAE regulatory context

Three overlapping compliance obligations
that UAE businesses manage simultaneously.

UAE VAT

VAT at 5% — since January 2018

Every transaction needs correct VAT treatment: standard rated (5%), zero rated (exports, international transport), exempt (residential property, bare land, local passenger transport), or out of scope. Wrong treatment means incorrect VAT returns and FTA penalties. Input tax recovery depends on correct classification from day one.

Filing: Quarterly / Monthly · Regulator: FTA

UAE CORPORATE TAX

CT at 9% — since June 2023

9% corporate tax on taxable income above AED 375,000. Applies to mainland and most free zone entities unless they qualify as a Qualifying Free Zone Person (QFZP). CT requires IFRS-compliant accounting, correct tax period identification, and separate tracking of exempt and non-exempt income. First CT returns are now due.

Annual return · Regulator: FTA · Rate: 9%

WPS PAYROLL

Wages Protection System — mandatory

All private sector employers in the UAE must pay salaries through WPS — a government system monitoring salary payments via approved channels. Non-compliance results in labour permit suspension. WPS requires a SIF (Salary Information File) generated from payroll each month. Gratuity (end-of-service benefit) must be provisioned monthly under UAE Labour Law.

Monthly · Regulator: MOHRE · Mandatory

ALSO REQUIRED

UBO (Ultimate Beneficial Owner) declarations and licence renewals — mainland and most free zones. AML/CFT registration on the UAE's goAML platform for designated sectors (real estate brokers, precious metals dealers, corporate service providers, auditors). Both are periodic, not one-time, and easy to let lapse silently.

What we deliver monthly

Full UAE accounting service.
Delivered monthly, remotely.

Daily bookkeeping

Every transaction posted in Zoho Books or QuickBooks — sales invoices, purchase bills, expenses, bank receipts and payments. AED, USD, EUR and GBP handled in the same set of books. Bank feeds connected where available.

Monthly close — IFRS compliant

Bank reconciliation complete. Accruals and prepayments posted. Depreciation calculated. FX gain/loss entries posted. IFRS-compliant P&L, balance sheet and cash flow delivered by day 5 of each month.

VAT return — quarterly

All transactions reviewed for correct VAT treatment. VAT return prepared and filed with the FTA via the EmaraTax portal. Input tax recovery maximised. VAT payable or refund position reported before the filing date.

WPS payroll and gratuity

Monthly payroll processed. WPS SIF file prepared and submitted. Gratuity provisioned per employee as a monthly liability. End-of-service calculations maintained from each employee start date.

Frequently Asked Questions

Do UAE businesses need IFRS accounting?+

Yes. UAE Commercial Companies Law requires mainland companies to maintain accounting records and prepare financial statements under IFRS. Free zone regulations similarly require IFRS compliance. With UAE Corporate Tax now in force, IFRS-compliant accounting records are also a prerequisite for CT compliance. A business that has been maintaining books on a cash basis needs to convert to accrual IFRS accounting before its first CT filing.

What is the UAE VAT rate and who must register?+

UAE VAT is 5% on standard rated supplies. Mandatory VAT registration is required when taxable turnover exceeds AED 375,000 in any 12-month period. Voluntary registration is available from AED 187,500. Once registered, quarterly VAT returns must be filed with the FTA via the EmaraTax portal. Input tax on business expenses is recoverable against output tax.

Are free zone companies subject to UAE Corporate Tax?+

Free zone entities can qualify for 0% CT on qualifying income if they meet the criteria of a Qualifying Free Zone Person (QFZP). To maintain QFZP status they must: meet the substance requirements in the free zone, derive income only from qualifying activities, not have a permanent establishment on the UAE mainland, and maintain adequate accounting records. Non-qualifying income is taxed at 9%. The determination is complex and requires review of each entity's activities and contracts.

Can you manage accounting for a UAE company remotely?+

Yes. We manage UAE accounting entirely remotely using Zoho Books or QuickBooks — cloud platforms that allow document sharing, bank feed connections, and real-time collaboration. Documents are received digitally. Bank statements are shared via bank feed or secure upload. VAT returns are filed via the FTA EmaraTax portal. Monthly accounts are delivered by day 5. No physical office presence required.

Go deeper

UAE accounting, by platform.

Zoho Books

UAE VAT and Corporate Tax Setup in Zoho Books

Step-by-step configuration — tax categories, EmaraTax filing, QFZP tracking, and where WPS payroll actually connects.

QuickBooks

UAE Accounting in QuickBooks: What Works and What Needs a Workaround

What QuickBooks handles natively for UAE VAT, what needs a manual workaround, and where it falls short of Zoho Books.

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Get in touch

Tell us your
situation.

One conversation is usually enough to understand your setup and tell you honestly what we can fix, how long it takes, and what it costs. No obligation.

Phone & WhatsApp +91 94045 42550

Email piyush@khetanca.com

💬 WhatsApp us now

UAE accounting.IFRS, VAT and Corporate Tax — handled.

The pattern we see in almostevery UAE business we take over.

Three overlapping compliance obligationsthat UAE businesses manage simultaneously.

Full UAE accounting service.Delivered monthly, remotely.