What records does a small business need to keep for UAE tax?

Article 78 - Record-keeping 1. Without prejudice to the provisions related to record-keeping stated in any other law, the Taxable Person shall keep the following records: a. Records of all supplies and Imports of Goods and Services. b. All Tax Invoices and alternative documents related to receiving Goods or Services. c. All Tax Credit Notes and alternative documents received. d. All Tax Invoices and alternative documents issued. e. All Tax Credit Notes and alternative documents issued. f. Records of Goods and Services that have been disposed of or used for matters not related to Business, showing Taxes paid for the same. g. Records of Goods and Services purchased and for which the Input Tax was not deducted. 35 Clause amended as per Federal Decree-Law No. 16 of 2024. 36 Clause amended as per Federal Decree-Law No. 16 of 2024. 37 Article amended as per Federal Decree-Law No. 18 of 2022. Federal Decree-Law No. 8 of 2017 and its amendments – As published by the Ministry of Finance 37 h. Records of exported Goods and Services. i. Records of adjustments or corrections made to accounts or Tax Invoices. j. Records of any Taxable Supplies made or received in accordance with Clause 3 of Article 48 of this Decree-Law, including any declarations provided or received in respect of those Taxable Supplies. k. A Tax Record that includes the following information: 1) Due Tax on Taxable Supplies. 2) Due Tax on Taxable Supplies pursuant to the mechanism in Clause 1 of Article 48 of this Decree-Law. 3) Due Tax after the error correction or adjustment. 4) Recoverable Tax for supplies or Imports. 5) Recoverable Tax after the error correction or adjustment. 2. The Executive Regulation of this Decree-Law shall specify the following: a. Time limits, controls and conditions for keeping the records listed in Clause 1 of this Article. b. Controls and procedures regarding the maintenance of the confidentiality of the records that may be accessed by the Authority in the case of Government Entities mentioned under Clause 2 of Article 72 of this Decree-Law.

Article 56 – Record Keeping 1. Notwithstanding the provisions of the Tax Procedures Law, a Taxable Person shall maintain all records and documents for a period of (7) seven years following the end of the Tax Period to which they relate that: a. Support the information to be provided in a Tax Return or in any other document to be filed with the Authority. b. Enable the Taxable Person’s Taxable Income to be readily ascertained by the Authority. 2. Notwithstanding the provisions of the Tax Procedures Law, an Exempt Person shall maintain all records that enable the Exempt Person’s status to be readily ascertained by the Authority for a period of (7) seven years following the end of the Tax Period to which they relate.

Small Business Relief works by treating eligible Resident Persons as having no Taxable Income if their Revenue is equal to or below AED 3,000,000 for the relevant Tax Period and all previous Tax Periods. Therefore, in order to demonstrate that they have no Taxable Income, the eligible Resident Persons must be able to provide evidence to the FTA that their Revenue did not exceed the Small Business Relief threshold for all relevant Tax Periods. As every Business is different, there is no prescribed list of documentation or records that should be maintained. However, examples of documents which need to be kept include but is not limited to: ● ● ● ● ● Bank statements; Sales ledgers; Invoices or other records of daily earnings, such as till rolls; Order records and delivery notes; and Other relevant Business correspondence. There is no requirement that documents are maintained in their original format and it may be possible to keep them in an alternative format. For example, paper receipts could be scanned and stored electronically. Whatever storage medium is chosen, the records need to be readable and available to the FTA on request. Businesses are responsible for the storage of their own records and documentation. Taxable Persons must provide the FTA with any information, documents or records reasonably required by the FTA when requested to do so. The records must, therefore, be easily accessible if the FTA requests them. Record keeping period All Businesses must keep records and documents for seven years following the end of the Tax Period to which they relate.63 This requirement applies to the Tax Period to which the documents relate, and not the Tax Period in which they were created. For example, if a Taxable Person uses the cash basis accounting method, they may have invoices which were raised in the Tax Period before the one in which they were paid. In this instance the seven-year period starts from the end of the Tax Period in which the invoices were paid, and not the date that they were created. 63 Article 56 of the Corporate Tax Law. Corporate Tax Guide | Small Business Relief | CTGSBR1 38

7 How to make an election for Small Business Relief? Eligible Taxable Persons that meet the conditions for Small Business Relief and wish to benefit from it must first register for Corporate Tax purposes. Thereafter, they must make an election in their Tax Return in order to benefit from this relief. This election must be made for each Tax Period for which a Tax Return is filed in order for the relief to apply for that Tax Period. For further information on the Small Business Relief election, please refer to the guidance published on the FTA’s website7. 8 What is the Corporate Tax filing requirement? All Taxable Persons must file a Tax Return or a simplified Tax Return (in case of Small Business Relief election) via EmaraTax, no later than nine months from the end of the relevant Tax Period. For further information on how to file a Tax Return, please refer to the guidance 8 published on the FTA’s website . 9 Are small businesses required to maintain any records? All Businesses are required to maintain records and documents for a period of seven years following the end of the Tax Period to which they relate. Such records and documents should: - Support any information provided in a Tax Return, or in any other document that is filed with the FTA - Enable the FTA to readily ascertain the Taxable Person’s Taxable Income calculation Records and documents to be maintained typically include: - Financial Statements (which must be audited in specific situations) - Bank statements - Loan or financing documentation - Sales and purchase ledgers - Invoices or other records of daily earnings, such as till rolls - Purchase orders and delivery notes - Other relevant business correspondence 7 Corporate Tax Guide - Small Business Relief. https://tax.gov.ae/en/taxes/corporate.tax/corporate.tax.guides.references.aspx 8 Corporate Tax Guide - Tax Return. https://tax.gov.ae/en/taxes/corporate.tax/corporate.tax.guides.references.aspx