Tag: hardware business UAE

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What Does UAE Corporate Tax Relief Really Mean for Small Hardware Businesses?

New Tax Rules? Sounds Worrying, Right?
If you’re a shopkeeper or supplier running a small hardware or building materials business in the UAE, the recent talks about corporate tax might sound a bit worrying. But there’s good news too. The UAE has clarified how small businesses can get relief from corporate tax and how interest expenses will be handled.

So, what does this really mean for someone who runs a fasteners shop in Deira or a tools store in Musaffah?

Let’s break it down in a simple way.

If You’re Small, You Might Be Exempt
Under the UAE’s corporate tax law, businesses with revenue of AED 3 million or less can apply for small business relief. This means if your total income is within that limit, you won’t have to pay corporate tax at all!

That’s a huge relief for thousands of shopkeepers and small traders — including many listed on Gulfinquiries.com.

What If You’ve Taken Loans or Credit?
Many businesses use credit lines or loans to purchase stock or import materials. The new rules also explain how interest expenses will be handled. You can still deduct these expenses, but there are some limits — mainly to avoid fake debt arrangements just to avoid tax.

But if your finances are clean and you’ve taken loans the proper way, it’s all manageable.

How to Stay Prepared — Without Complicating Things
Most shopkeepers are too busy handling sales, deliveries, and staff to sit and read tax policies. That’s where being connected with a platform like Gulfinquiries.com helps.

Not only do we promote your business through daily WhatsApp and email marketing, but we also:

  • Guide small businesses on preparing for changing UAE business rules
  • Connect you with active buyers and new business inquiries daily
  • Help businesses like AHMAD AND KHADEEJA TRADING and POWERTEX TOOLS get discovered faster

Why Visibility is the Key Now
You might not have to pay tax, but the market is still competitive. Everyone is trying to grow, especially with the UAE becoming a stronger trade hub.

If your business is listed on Gulfinquiries.com, buyers know you’re serious, reliable, and professional. Whether you’re dealing in cutting tools like MIDLAND HARDWARE LLC in Sharjah or interior fit-outs like Section Interiors in Qusais, you’ll want to make sure people can find you and contact you instantly.

Don’t Just Wait for Customers – Let Them Find You
The government is doing its part with tax relief. Now, it’s your turn to step up your visibility and customer reach.

✅ Start with Gulfinquiries.com today.
✅ Be tax-smart. Be business-smart.
✅ And let your shop grow beyond your expectations.

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DO FREE ZONE COMPANIES IN THE UAE HAVE TO PAY CORPORATE TAX IN 2025?

Corporate tax in the UAE has become quite the hot topic lately—especially for businesses operating in free zones. Many people still ask, “Do free zone companies need to pay corporate tax or are they exempt?” Let’s clear it up in plain English.

Here’s the short answer: Yes… and no.

It all depends on what your company is doing.

The UAE introduced corporate tax in 2023 at a standard rate of 9% on net profits exceeding AED 375,000. But here’s the interesting part—free zone companies can still benefit from tax exemptions if they meet certain conditions.

So when is a free zone company exempt from corporate tax?

The UAE government allows a 0% corporate tax rate for qualifying income earned by free zone companies. But to enjoy this benefit, your company must:

  • Be registered in a recognised free zone.
  • Maintain adequate economic substance in the free zone.
  • Earn only qualifying income (we’ll explain that in a moment).
  • Not have elected to be taxed under the standard rate.

If you meet these conditions, your free zone company may continue to enjoy the 0% corporate tax rate.

What is “qualifying income” exactly?

This is key. Qualifying income includes things like:

  • Trading goods within the same free zone or with businesses in other UAE free zones.
  • Exporting goods or services outside the UAE.
  • Providing services to businesses located outside the UAE.

But the moment your free zone company starts dealing with the UAE mainland market (outside of free zones), that part of your income might become taxable.

So if you’re a hardware trader in a free zone and start selling to mainland shops or contractors, the income from those deals may not be tax-free.

Can you split your income?

Yes, but it gets tricky. The government allows what’s called a segregation of accounts, meaning you can separate qualifying income from non-qualifying income. But you’ll need proper accounting, clear reporting, and annual audits to do this correctly.

Also, if too much of your income becomes non-qualifying, your whole business might lose the 0% benefit.

Should free zone companies worry about this?

Not if you stay updated and stay compliant. Many businesses are hiring tax advisors now just to be safe. The UAE tax authority has been clear—they’re not here to create a burden, but transparency and proper reporting are expected.

Final word

If you run a free zone company in the UAE, the good news is: you can still benefit from 0% corporate tax—but only if you follow the rules. It’s worth reviewing your income sources and getting professional advice.

Being prepared now means fewer surprises later—and a healthier business in the long run.

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Why Some UAE Suppliers Are Now Asking for Weekly Payments Instead of Monthly Credit

In recent times, many shopkeepers and traders in the UAE have noticed a shift in how suppliers want to do business. The long-standing norm of monthly credit is slowly giving way to a new trend—weekly payments.

If you’re wondering why your supplier suddenly wants payment every 7 days instead of the usual 30, you’re not alone. This isn’t just about being strict—it’s a sign of the times.

📉 1. Rise in PDC Defaults and Late Payments

2023 and 2024 saw an increase in Payment Default Cheques (PDCs) bouncing or being delayed. Many suppliers had to chase payments, block deliveries, and even face legal expenses.

By switching to weekly payments, suppliers reduce the risk of accumulating unpaid bills. It’s easier to absorb a one-week delay than a one-month default.

💸 2. Suppliers Also Have Bills to Pay

Remember, your supplier might be getting their goods from manufacturers on weekly payment terms themselves. Their rent, wages, and logistics costs don’t wait till the end of the month. Cash flow is king—just like it is for your business.

🔁 3. Faster Turnover, Smaller Stocks

Many traders today prefer faster turnover with lower stock levels. Weekly billing helps maintain a rhythm. Buy, sell, collect money, pay—repeat. This makes both supplier and buyer stay alert and organized.

It also builds a healthy pattern of short credit cycles, improving trust on both ends.

🤝 4. Building Stronger Relationships

Surprisingly, weekly payments can actually improve your supplier relationship. Here’s why:

  • Less pressure: Neither side holds too much credit.
  • More flexibility: You might even get better pricing or priority delivery.
  • Clear accounts: Fewer outstanding balances means fewer disputes.

Some suppliers even offer small discounts for early or weekly payments, which is a win-win.

📦 5. Inflation and Import Costs

Global inflation and currency fluctuations have affected import prices. To manage this, UAE suppliers prefer quicker payments so they can reorder stock without taking bank loans or absorbing extra risk.

Weekly payments help them stay liquid and competitive, especially when margins are tight.

🛠️ What Can Shopkeepers Do?

  • Plan inventory: Don’t overbuy. Keep weekly stock control to match weekly payments.
  • Talk to your supplier: Negotiate realistic terms. Maybe bi-weekly instead?
  • Build trust: Make timely payments and you’ll become a preferred customer.
  • Use tech tools: Mobile reminders, simple accounting apps, or Excel can help you stay on track.

📌 Final Thought

Weekly payments are not a punishment—they’re a practical step in today’s fast-moving business environment. Suppliers are adapting to financial realities, and as shopkeepers, adjusting with them can lead to stronger, more dependable business ties.

Treat it as a chance to sharpen your cash flow game and position your shop for smoother growth in 2025.