Tools · CORPORATE TAX · TRANSFER PRICING
Intercompany loan interest calculator (UAE TP)
Enter the loan, the rate charged and an arm's length rate. See the adjustment on each side, including when one company sits in a free zone or abroad.
Lender
Borrower
Interest charged
AED 0
Arm's length interest
AED 3,100,000
Adjustment
AED 3,100,000
Net extra UAE tax for the group
AED 279,000
Under-charged: the lender's taxable income rises. The lender's income rises by AED 3,100,000: AED 279,000 of tax at 9%. The borrower gets a corresponding deduction of AED 3,100,000 under Article 34(10), worth AED 0 at 0%. Interest on a 365-day basis. Article 31 and the 30% interest cap then apply to the arm's length interest only.
Disclaimer
Illustrative figures computed in your browser. Nothing is uploaded, stored or sent anywhere. Not accounting or tax advice; verify treatment with your advisor.