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March 10, 2025

UAE & Saudi Tax Updates: What You Need to Know In Feb 2025

Staying on top of tax updates isn’t easy, but it’s essential to keep your business compliant and avoid penalties.

This month, there are major changes in tax laws across the UAE and Saudi Arabia. Here’s what you need to know and what actions you should take.

UAE: E-Invoicing Is Coming – What It Means for Your Business

What’s happening?
The UAE Ministry of Finance (MoF) is introducing E-Invoicing in July 2026. A recent consultation paper aims to collect feedback from businesses to fine-tune the system before launch.

What does this mean for you?

  • Manual invoices will become a thing of the past. Businesses must switch to electronic invoicing.
  • Standardised invoicing rules. The government will establish a clear, uniform format for digital invoices.
  • Less fraud, better compliance. The new system aims to reduce tax fraud and improve efficiency in tax reporting.

What should you do now?

  • Start planning. If you’re still using paper invoices or spreadsheets, look into cloud-based accounting software.
  • Consult an expert. Make sure your systems will meet the new requirements before the deadline.

UAE: Extended Deadlines for Tax Appeals – But Only in Certain Cases

What’s happening?
The UAE Federal Tax Authority (FTA) now allows deadline extensions for submitting Tax Assessment Reviews (TAR) or reconsiderations.

However, not all businesses qualify for an extension.

When can you apply for an extension?

  • Medical emergencies – If the company’s authorised signatory had a serious illness or accident.
  • Unexpected business disruptions – If a disaster or system failure impacted tax records.
  • System issues – If the FTA’s online system malfunctions.
  • Force majeure events – Any unforeseeable event, determined at the FTA’s discretion.

When will the FTA reject your request?

  •  If you forgot or were unaware of your tax obligations.
  • If you missed deadlines due to your tax agent’s negligence.
  • If you were too busy running your business and didn’t submit on time.

What should you do now?

  • Be proactive. Keep track of deadlines to avoid needing an extension.
  • Document everything. If you think you may qualify for an extension, keep detailed records.

UAE: New Rules for Tax Clarifications & Directives

What’s happening?
The FTA has introduced new rules for tax clarifications and directives to provide clearer guidance on tax matters.

What does this mean for your business?

Clarifications – You can request a formal ruling from the FTA if you’re unsure how tax laws apply to your business.

Directives – The FTA will issue industry-wide guidelines to ensure businesses follow tax laws correctly.

What should you do now?

  •  If you’re unsure about tax laws, request a clarification. This ensures you’re compliant and reduces risk.
  • Stay informed. Keep an eye on FTA directives that apply to your industry.

Saudi Arabia: New Transfer Pricing Guidelines

What’s happening?
Saudi Arabia’s Zakat, Tax, and Customs Authority (ZATCA) has released a new Advance Pricing Agreement (APA) Guide for Transfer Pricing.

Why does this matter?

  • If your business has related-party transactions (e.g., a UAE company working with a Saudi subsidiary), you need to ensure your pricing complies with international standards.
  • APAs help prevent tax disputes by ensuring transactions are priced fairly and in line with the Arm’s Length Principle.

What should you do now?

  • If you do business across borders, review your transfer pricing policies.
  • Consult a tax expert to ensure compliance with Saudi tax laws.

Stay Ahead of Compliance Changes

Tax rules are constantly evolving. Falling behind can mean hefty fines, compliance risks, and unnecessary stress.

What’s the best way to stay compliant?

  • Stay informed – Follow tax updates and new regulations.
  • Get expert advice – Work with a tax professional to ensure compliance
  • Start planning early – Don’t wait until the last minute to adopt new tax systems.

At Nishe, we simplify tax and compliance so you can focus on running your business.

Need help understanding how these changes affect you? Fix a call with one of the team now!

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