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?
- Banking Business
- Insurance Business
- Investment Fund Management Business
- Lease -Finance Business§Headquarters Business
- Shipping Business
- Holding Company Business
- Intellectual property Business (“IP”)
- 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: firstname.lastname@example.org