Qatar Financial Centre (QFC) has enacted the recently amended tax rules and regulations as part of the ongoing enhancement and development of its platform to better attract investments.
The amendment clarifies the definition of ‘local source taxable profits’ and includes a provision to exclude profits of non-regulated firms that are derived from services used outside Qatar, provided the firm’s accounts are audited and reported on by an external auditor. At least 30% of the firm’s income can be attributed to activities undertaken by the QFC firm in Qatar. The firm employs at least three full time employees, and the services are not rendered under an arrangement, the sole or main purpose of which is the avoidance of tax.
Other minor changes were also introduced to clarify the definition of Qatari-owned companies and the application of the late payment charge. In addition, the amendments now allow for the service of documents and notices to be made by e-mail or other designated means of electronic transmission.
“This recent enhancement widens the scope for firms who provide services to overseas entities to avail of tax reliefs,” QFC chief finance and tax officer Hamed al-Saadi, said, adding “these changes have been made taking into account international tax initiatives such as the BEPS (base erosion and profit shifting) project”.
BEPS refers to tax planning strategies used by multinational companies, that exploit gaps and mismatches in tax rules to artificially shift profits to low or no-tax locations where there is little or no economic activity. The project headed by the Organisation for Economic Cooperation and Development was initiated by the G20 in 2012.
Al-Saadi: Widened scope.
