Clarifications related to ESR notification by RAKEZ

Following are the clarifications provided by RAKEZ for all common questions related to Economic Substance Regulations (ESR) return submission

 

Question : Should the ESR return be submitted by All UAE licenced entities?

Answer : Yes, the ESR return should be submitted by All UAE licenced entities whether carrying out a Relevant activity or not.

 

Question : What are the Relevant activities?

Answer :

  1. Banking Business
  2. Insurance Business
  3. Investment Fund Management Business
  4. Lease -Finance Business§Headquarters Business
  5. Shipping Business
  6. Holding Company Business
  7. Intellectual property Business (“IP”)
  8. Distribution and Service Centre Business

 

Question : We are carrying out a Relevant activity but not generating any income, should the ESR return be completed in such a case.

Answer : Yes as mentioned earlier All UAE licenced entities, whether carrying out ‘Relevant activities’ or not and whether generating income or not, will have to submit the ESR return.

 

Question : What is to be mentioned under “Financial Year end/Accounting reference period” in the form.

Answer : Please mention your company’s Financial / Accounting year as documented in your Constitutional documents. Eg: Jan to Dec (or) Apr to Mar etc.

 

Question : What is to be mentioned under “Reportable period for Economic Substance purposes” in the form.

Answer : The UAE ESR Regulations (Cabinet of Ministers Resolution no 31 of 2019) requires ESR return submissions within 12 months from the end of the Financial/Accounting year of a licencee.

Therefore if a company’s Financial / accounting year has ended in Dec 2019, the reporting period will be 1 Jan 2020 to 31 Dec 2020. Similarly for a company whose financial year ended in Sep 2019, the reporting period will be 1 Oct 2019 to 30 Sep 2020. i.e: 31/12/2019 (or) 30/09/2019 as the case may be.

 

Question : Our company is not carrying out a Relevant activity while the return asks for a mandatory selection of a Relevant activity. We are therefore not able to submit the ESR return.

Answer In the form, please select the option “None of the above” under Relevant activities in such cases.

 

Hurry up! Reach Spectrum Audit & Accounting today to know more about ESR @ +971 50 9866466. We are here to guide you and take care of you. Alternatively, you can also mail us at: info@spectrumaccounts.com

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