UAE’s rise in complexity a natural result of VAT introduction
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UAE’s rise in complexity a natural result of VAT introduction

15 April 2018

Following on from its inaugural ranking of 92, this year the UAE is 74th out of 94 jurisdictions globally for financial complexity.

The United Arab Emirates (UAE) is among the 20 least complex jurisdictions in the world for accounting and tax compliance, according to TMF Group’s Financial Complexity Index 2018.

94 jurisdictions across Europe, the Middle East, Africa, Asia Pacific and the Americas were ranked; 1 being most complex through to 94 the least complex. The UAE came in at 74th, indicating an increase in complexity since its 2017 inaugural ranking of 92.

To determine the rankings with its in-country experts, TMF Group used a 74-question survey with weighted complexity parameters, namely; regulatory compliance, tax, statutory reporting and bookkeeping.

THE 10 LEAST COMPLEX JURISDICTIONS FOR FINANCIAL COMPLIANCE

 GLOBAL RANKING   JURISDICTION  REGION
 94  Cayman Islands   Americas
 93  BVI  Americas
 92  Jersey  EMEA
 91  Hong Kong  APAC
 90  Curacao  Americas
 89  Afghanistan  APAC
 88  Guyana  Americas
 87  Norway  EMEA
 86  Bangladesh  APAC
 85  Singapore  APAC

Commenting on the UAE’s ranking, TMF Group’s Regional Director, Middle East and Africa Jonathan Wheeler said: “The UAE’s rise in complexity this year is largely driven by the introduction of the emirates’ first VAT in January 2018.

“The VAT is a fundamental change to the way businesses operate locally. The transaction tax is embedded in virtually all functions of a company; from sales contracts to accounting and bookkeeping. So it’s an important one for businesses to document and report correctly.

“While the UAE may not be on our ‘top 5 easiest’ list in this year’s Financial Complexity Index, it remains at 74th, one of the less complex jurisdictions globally for accounting and tax compliance - and a very attractive market for business.”

Head of EMEA Juraj Gerzeni added: “The adjustment period for companies operating in the UAE – and Kingdom of Saudi Arabia – is very much ongoing, as four Gulf Cooperation Council countries are yet to implement the VAT. When they do, special rules for inter GCC transactions will begin to apply.

“When it comes to cross-border business success, knowing and understanding the local requirements for financial compliance can prove vital. Seeking the support of in-country experts, such as TMF UAE, allows companies of all sizes to maintain focus on their core business.”

Need more information? Register for our 8 May 2018 briefing session in Abu Dhabi.

Make an enquiry with our experts in the UAE today.

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