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Clarifications related to ESR notification by RAKEZ

icon May 17, 2020 | icon ESR and CbCR

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 on 31 Dec 2019, the reporting period will be 1 Jan 2019 to 31 Dec 2019. Similarly

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