Accounting Support for UAE Professional Firms

Fee income needs a clean cut-off

Professional firms earn retainers, success fees and reimbursable expenses. The month the work is done, the month the invoice is raised and the month the client pays are often three different months. Bookkeeping that only records the bank receipt will misstate both the management accounts and the tax figures.

What we typically maintain

The useful file for a professional practice is shorter than a trader’s, but the judgements are sharper: work in progress, disbursements that belong to the client, and costs that are the firm’s own.

• Fee invoice and receipt recording
• Retainer and accrual tracking
• Expense coding between client disbursements and firm overheads
• Monthly profit reporting for the owners

Tax points that come up often

Most local professional services are standard-rated for VAT when the firm is registered, but cross-border clients and services connected with property or goods need a specific look. Registration itself still depends on the AED 375,000 mandatory threshold and the AED 187,500 voluntary threshold for a UAE-resident business, measured on taxable supplies and imports, not on profit.

Corporate Tax applies to the firm’s taxable income. Partner drawings are not the same thing as a deductible salary. We treat that from the accounts and the legal form of the practice, which may be a company or a natural person with different registration rules.