UAE tax rules: What businesses can claim for employee expenses
Giving employees the tools they need to do their jobs effectively is a timeless business requirement. Whether a company has standard lists of equipment and resources for different grades and functions, which it should to make onboarding easier, most businesses could produce such lists without much difficulty. There are, however, tax considerations, particularly corporation tax and VAT .…
UAE tax rules for employee expenses provide guidance for businesses on various allowances they can claim. Transport provided for staff must be given at no cost and only between home and workplace, with no collection points or cash payments allowed. Pooling transport between neighboring companies could complicate matters, as each company would need to invoice the commercial neighbor.
Food and beverages are permissible when employees live remotely, but the definition of remote and the minimum number of employees qualifying is not specified. Company-provided accommodation is only necessary if the work site is in a remote location, and the accommodation should be suitable but not luxurious. Onboarding new employees can have accommodations for up to 30 days without ostentatious features.
Mobile phones must be work-related and used solely for business purposes, with personal calls excluded from VAT or corporation tax claims. A formal standard operating policy is required, communicated, reviewed, updated, and enforced for all employees.
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