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In this month's newsletter, we delve into the latest tax updates within the Gulf Cooperation Council (GCC) member states, highlighting critical updates and insights that impact businesses and investors across the region.

In April 2024, the UAE's Ministry of Finance (MOF) initiated a public consultation on potential Research & Development (R&D) initiative for the purposes of Corporate Income Tax (CIT). The consultation aims to gather views from all stakeholders on what effective R&D tax incentives may look like. The UAE MOF has set the deadline for the public consultation on 14 May 2024.

On 3 April 2024, the UAE’s Federal Tax Authority issued a Guide on the Qualifying Group Relief for purposes of CIT. This publication includes helpful guidance on (i) which transactions are covered by the relief, (ii) the requirements in order to benefit from the relief, (iii) the tax consequences of claiming the relief and (iv) potential claw-back considerations for any previously claimed relief.

On 17 April, the UAE’s FTA also issued a detailed CIT Guide on the Business Restructuring Relief which is part of the UAE CIT regime. This guide outlines (i) the types of transactions eligible for relief, (ii) necessary conditions for qualification, and (iii) the tax implications of claiming the relief. Additionally, it addresses potential claw-back scenarios that could affect the relief's applicability.

Also in April, the FTA issued a decision to enforce professional standards for tax agents in the UAE. The decision introduces a black points system designed to enforce these standards by penalizing professional misconduct. Along with this decision, the FTA also issued a detailed guide on "Professional Standards for Tax Agents" which replaces the previous version from May 2019.

In Saudi Arabia, ZATCA released a comprehensive guideline on VAT refunds for non-resident businesses, clarifying the two-phase process which non-residents should follow to submit their VAT refunds claims through the electronic portal. ZATCA also issued detailed guidelines on the Regional Headquarter Tax Rules which were published in February of this year, further clarifying the various tax incentives granted to Regional Headquarters in the Kingdom.

In April 2024 we also saw continued strengthening of international business relations through the expansion and updating of Double Tax Treaty (DTT) networks among GCC Member States. These developments aim to enhance the Gulf region's attractiveness as a global business hub, facilitating smoother cross-border trade and investment activities.

Through these articles, we aim to provide you with insightful analysis and updates on the evolving tax landscape in the UAE and the wider GCC region. We hope this edition offers valuable knowledge to navigate the complexities of the current tax environment.

As always, we look forward to your thoughts, comments, and feedback. 

In the dynamic tax landscape of the GCC, it is crucial for our Middle East tax team to keep up to date with all relevant developments. This enables us to consistently deliver high-quality advice and added value to our local and international clients. We are thrilled to announce that in April 2024 our team has expanded with the addition of a seasoned tax manager - Rocio Falagan. Rocio is a qualified tax lawyer with six years of expertise in Corporate Income Tax, International Tax (Pillar 2), M&A Tax, Economic Substance Regulations, and VAT. Her expertise will be invaluable to our team, and she will play a key role in contributing to our monthly newsletter Gulf Tax Insights.

We extend a warm welcome to Rocio!