Why Bookkeeping Matters for Small Businesses in Dubai
With over 94% of UAE businesses classified as SMEs (source: UAE Ministry of Economy), small businesses are the backbone of Dubai’s economy. However, studies show that more than 60% of these Businesses face difficulties with financial record-keeping and tax compliance (Zoho Books, 2023).
The recent introduction of Corporate Tax (9%) and existing VAT regulations by the Federal Tax Authority (FTA) make it essential for businesses to maintain proper books. Inaccurate or incomplete bookkeeping can lead to penalties, compliance issues, and cash flow bottlenecks.
Small businesses generate less revenue. If AED 3 million is eligible to claim the tax benefits, still, companies are liable to comply with regulation by maintaining proper books of accounts, corporate tax registration and timely submission of corporate tax returns.
Further companies incurring tax loss in the current financial year are eligible to carry forward this loss, and this loss can be offset with tax profit in upcoming years. To get this benefit, companies are required to submit corporate tax returns before the deadline.