Regulation No. (2) of 1996 Concerning Collection of Tax from Branches of Foreign Banks in the Emirate of Dubai

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Preamble:

Regulation No. (2) of 1996

Concerning Collection of Tax from Branches of

Foreign Banks in the Emirate of Dubai [1]

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We, Hamdan bin Rashid Al Maktoum, Deputy Ruler of Dubai,

[1]Every effort has been made to produce an accurate and complete English version of this legislation. However, for the purpose of its interpretation and application, reference must be made to the original Arabic text. In case of conflict, the Arabic text will prevail.

Do hereby issue this Regulation.

Article (1):

Article (2):

Article (2)

The following words will have the meaning indicated opposite each of them unless the context implies otherwise:

Emirate:	The Emirate of Dubai.
DOF:	The Department of Finance.
FAD:	The Financial Audit Directorate at His Highness the Ruler’s Court.
Branch:	A branch of a foreign bank operating in the Emirate.
Tax Base:	The net profits of a Branch which are subject to tax under this Regulation.
Financial Year:	The year commencing on 1 January and ending on 31 December of each Gregorian calendar year.
Capital Expenditure:	Expenses of a capital nature, rather than an operating nature, whose benefit may extend to subsequent financial periods.
Regional Management Expenditures:	The supervisory expenses of the regional management existing within or outside of the Emirate.
Central or Joint Expenditures:	The joint operating expenses of all Branches operating within or outside of the Emirate.
Central or Joint Revenues:	The operating revenues generated from the joint investments and activities of the Branches operating within or outside of the Emirate.
Interest in Suspense:	Interest which is due on slow-moving and doubtful debts and which is set aside from the revenues account.
Accounting Policies:	The consistent accounting policies adopted by a Branch in accordance with the accrual basis of accounting and the recognised international accounting standards.
Branch Assets:	The total assets of a Branch before deducting the allowance for doubtful debts, Interest in Suspense related to these debts, and any other allowance.

Article (3):

Article (4):

Article (4)

A Branch must pay the tax to the DOF, as per the tax return submitted by it for the relevant Financial Year, within no later than the last day of the first quarter of the year following the end of that Financial Year of the Branch.
Where a Branch fails to pay the tax within the time frame referred to in the preceding paragraph, a delay fine of one percent (1%) of the tax amount will be charged for each thirty-day period, or any part thereof, until full payment is made.

Article (5):

Article (6):

Article (6)

Where the outstanding tax amount calculated based on the audit is not paid within the time frame prescribed in paragraph (d) of Article (5) hereof, a delay penalty of two percent (2%) of that outstanding amount will be charged for each thirty-day period, or any part thereof, until full payment is made.
Where it is established to the satisfaction of the FAD that a Branch has intentionally committed any violation with the intent to evade the payment of tax, a fine of five percent (5%) of the total amount of tax may be imposed.

Article (7):

Article (8):

Article (8)

This Regulation comes into force on the day on which it is issued, and will be published in the Official Gazette.

Hamdan bin Rashid Al Maktoum

Deputy Ruler of Dubai

Issued in Dubai on 31 December 1996

Corresponding to 21 Shaaban 1417 A.H.

Legislation information

Status

In Force

Date of Issuance

31 Dec 1996

Issuing Authority

Deputy Ruler of Dubai

Legislation Type

Regulation

SLC | Detail

Article (2)

Article (4)

Article (6)

Article (8)

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