What is a Foreign Tax Credit?
The foreign tax credit (FTC) allows businesses and individuals with foreign-sourced income to claim credits for taxes paid to foreign jurisdictions. This credit reduces your taxable income in the UAE and helps you avoid double taxation.
FTC Eligibility and Compliance
You will receive tax credits for whichever amount is lower between the two. Please note that the FTC in the UAE is for one-time use only and cannot be carried forward for future tax deductions.
- To qualify for the foreign tax credit, you must provide the following information:
- Your total income from foreign sources
- The total amount of taxes paid
- The country where the taxes were paid
- The maximum FTC available to you is determined by two factors:
- The amount of tax paid in the foreign country
- The amount of corporate tax owed on your foreign income
How Eslam Elgendy Can Help
Eslam Elgendy offers FTC advisory services to help you maximize the benefits of foreign tax credits provided by the UAE government. Our tax experts work with you to ensure you claim the highest possible tax credits, reducing your overall tax liability.
We assist you with:
- Determining your eligibility for foreign tax credits and identify the necessary documents and compliance obligations.
- Ensuring you claim the maximum foreign tax credits in accordance with the laws of the respective country and applicable double tax avoidance agreements.
- Foreign Tax Credit Advisory Services
- You can maximize your profitability from foreign income while minimizing tax concerns. We empower you to operate and scale globally without the burden of tax worries.
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