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UAE: Influencers to pay tax or face imprisonment 2023

The UAE has established new laws for social media influencers. Keep reading for more info

UAE: Influencers to pay tax or face imprisonment 2023

In a groundbreaking move for the influencer community in the UAE, recent tax regulations have brought influencers under the jurisdiction of the Corporate Tax Law. This shift signals a recognition of influencers’ entrepreneurial endeavors in marketing products or services to their audiences.

UAE tax laws: Everything you need to know

Under the new regulations, influencers are now categorized as businesses for tax purposes. This means they must adhere to the same tax obligations as traditional businesses. Key provisions of the regulations include mandatory registration with the FTA and obtaining a Corporate Tax Registration Number through the EMARATAX platform.

Influencers earning AED375,000 or more annually from their activities are subject to a 9% corporate tax. They are required to file annual tax returns, including supporting documentation, within nine months of the relevant tax period. Timely tax payments, in accordance with FTA-set deadlines, are also mandatory.

What are the consequences?

Non-compliance with these regulations carries severe consequences:

  1. The FTA has issued warnings, stating that influencers failing to register, file returns, or pay taxes on time may face administrative fines.
  2. Those who underreport or neglect to report their income may incur tax penalties.
  3. In extreme cases of tax evasion, influencers could even be subjected to criminal charges, potentially resulting in imprisonment for up to five years.

To navigate these new tax obligations successfully, UAE influencers are urged to take proactive measures. This includes immediate registration with the FTA, even if their income falls below the taxable threshold. Maintaining accurate records of income and expenses related to influencing activities is crucial.

UAE: Influencers to pay tax or face imprisonment 2023

How to stay on top

Seeking professional guidance from qualified tax advisors ensures a comprehensive understanding of specific tax obligations and guarantees proper compliance. Staying informed about updates or changes to tax regulations applicable to influencers is an ongoing responsibility.

By embracing these recommendations, UAE influencers not only safeguard themselves from legal and financial consequences but also contribute to a fair and transparent tax system in the country. Proactive adherence to these regulations ensures the continued growth and professionalism of the influencer community in the UAE.

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