ESR
Our briefings on ESR in the UAE — practical, current guidance from the FW Global team.
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ESR is not fully over: the legacy years 2019 to 2022.
The 2024 wind-down was good news, but it created a risk: the impression ESR is entirely behind every business. It applied fully to 2019 to 2022, and those obligations and penalties were not swept away. Here is what still matters and who should look.
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ESR relevant activities: who was in scope.
ESR did not apply to every business, only those carrying on defined relevant activities. Identifying whether you were in scope was the first question, and it still frames any legacy analysis for 2019 to 2022. Here is what the relevant activities were and how incidental ones caught businesses out.
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Economic Substance Regulations: where they stand now.
ESR generated years of work, and in 2024 the picture changed: a Cabinet decision limited it to financial years ending on or before 31 December 2022 and removed the filing and penalties for later periods. Here is where the regulations stand, period by period, and the legacy tail that remains.
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From ESR to Corporate Tax: where substance went.
It is tempting to read the end of ESR filings as a relaxation. That misses what happened: substance did not stop mattering, it moved into Corporate Tax, most sharply in the free zone qualifying conditions. Here is where substance went and why it now decides real money.
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What the Economic Substance Regulations required.
ESR no longer requires current filings, but what it demanded still matters, for legacy periods and because the thinking lives on in Corporate Tax. At its core it asked whether income was matched by real activity in the UAE. Here is what the substance test required.