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What is a Foreign Tax Credit (FTC)?

A Foreign Tax Credit (FTC) allows businesses and individuals earning income from foreign sources to claim credits for the taxes paid to foreign countries. This credit helps reduce the amount of corporate tax you need to pay in the UAE and prevents double taxation on the same income.

FTC Eligibility and Compliance

To be eligible for the foreign tax credit in the UAE, you must provide certain information, including:

  • The total income earned from the foreign country
  • The total amount of taxes paid to that foreign country
  • The name of the country where the taxes were paid

The amount of FTC you can claim depends on two key factors:

  1. The amount of tax you paid in the foreign country
  2. The corporate tax you are required to pay on your foreign income in the UAE

You will be able to claim a tax credit based on whichever amount is lower—either the foreign tax paid or the corporate tax owed in the UAE. Keep in mind that the FTC in the UAE can only be used once and cannot be carried forward for future tax deductions.

How Smart Business Creation Can Help with Foreign Tax Credit (FTC)?

At Smart Business Creation, we offer expert FTC advisory services to help you maximize the benefits of foreign tax credits. Our tax professionals work closely with you to ensure that you claim the maximum possible tax credits and minimize your overall tax liability.

Here’s how we can assist:

  1. Understanding FTC Eligibility:
    We guide you through the process of determining whether you qualify for foreign tax credits, and we help you gather all the necessary documentation to meet compliance requirements.

  2. Claiming Maximum Tax Credits:
    Our experts analyze the laws of the foreign country where you paid taxes and any relevant double taxation agreements to ensure you claim the maximum allowable tax credits.

  3. Ensuring Compliance:
    We make sure you stay fully compliant with both UAE tax laws and the regulations of the foreign country where taxes were paid, so you can claim your credits without any issues.

Why Choose Smart Business Creation for FTC Advisory?

  • Expert Guidance: Our tax experts have a deep understanding of UAE tax laws and international tax treaties, ensuring that you maximize your tax credits.
  • Maximize Profitability: We help you reduce your overall tax liability, allowing you to keep more of your foreign-sourced income.
  • Smooth Global Operations: With our foreign tax credit advisory services, you can confidently operate and expand globally without worrying about double taxation or compliance issues.

Ready to Claim Your Foreign Tax Credits?
Let Smart Business Creation guide you through the process of maximizing your FTC benefits and reducing your tax burden. Contact us today to schedule a consultation with our tax experts!