- Hi, I am Shailesh Kumar, a Chartered Accountant and a Seasoned Tax Professional with experience in both the UAE and India.
- After a decade of working with Indian taxation, my curiosity was sparked when the Corporate Tax law was announced in the UAE.
- Here’s my journey from India to PKF UAE and some valuable advice on building a tax career in the UAE.
Backstory
I started my journey from a small town in Bihar, India.
Even though I was good at academics, I wasn’t too ambitious. However, my Grandfather (Nanajee) always encouraged me to dream and achieve big.
Initially, my thought was to crack the Civil Services exams and become a bureaucrat.
The major turning point in my life and career came when I got admission into the Shri Ram College of Commerce, which is one of the top commerce colleges in India.
It was here that my focus shifted toward the subject of taxation, thanks to my exceptional tax teacher, Mr. Girish Ahuja. I made up my mind to build a career in taxation!
Becoming a Chartered Accountant was the obvious choice to excel as a Tax professional. For that reason, I enrolled in the CA course with The Institute of Chartered Accountants of India (ICAI).
Luck was also on my side as in 2005 I was selected by EY India to pursue my articleship, in the Tax team… Since then, my journey and passion for taxation have continued to grow.
Fast forward to 2007, I qualified as a Chartered Accountant and continued with EY India.
When I joined EY India in 2005, it was considered to be the best Tax Consulting firm in India (after its merger with Arthur Andersen).
I worked with some of the best Tax Professionals in EY, who taught me everything from drafting opinions with art-like perfection to understanding the client expectations, reading and interpreting case laws.
I also got the opportunity to work with the Tax litigation team of EY.
In 2012, I joined a specialized law firm in India; it was a beautiful transition from tax consultancy to the intricacies of litigation.
In December 2016, I joined Nangia & Co., one of India’s top Tax Advisory firms, as a Tax Director. I was having a great time working at Nangia and was promoted to Tax Partner.
What next?
The long-awaited UAE Corporate Tax Law is announced
On the 31st January 2022 implementation of the Corporate Tax was announced in the UAE.
In India, there was a lot of anticipation regarding the introduction of Corporate Tax in the UAE for two major reasons:
- UAE is popular for its infrastructure, strategic location, and cosmopolitan culture, making it an attractive destination for Indians.
- India has a well-established tax system, but the UAE was still developing its Corporate Tax laws. This presented a great opportunity to be a part of the process of implementing this new tax law.
Always hungry to grow and learn I too was keen to be a part of the opportunity UAE presented to Tax professionals like myself.
Even before any interviews came my way, I had thoroughly studied the Public Consultation Document and announcements/ FAQs issued by the UAE Government, forms and structures, under which businesses operated in the UAE, etc.
This study and preparation indeed helped me in hitting the ground running.
But would it be an easy move? How long would I have to wait to find a suitable opportunity, especially as an experienced professional? This and many other questions floated in my mind.
Sooner than expected, I came across a job opening for the Tax Head at PKF UAE, a firm with more than 45 years of presence in the UAE market.
It was shared with me via WhatsApp by a common friend.
Upon reviewing the job profile, I found it genuinely interesting. The organization was keen to fill the position at the earliest.
While interviewing for the position, they asked me to prepare a write-up on UAE Corporate Tax law and submit it by Monday. This conversation took place on a Friday.
Now, some might argue that as a candidate for a senior role, I shouldn’t be expected to draft things myself. However, I saw this as an opportunity to demonstrate my dedication. I spent the entire weekend preparing the write-up. By Sunday, it was ready to be sent.
I secured the final offer letter within just seven days of receiving that Whatsapp message. I finally joined PKF UAE in July 2022.
My promptness, quality of articulation, and knowledge of the UAE tax law were major factors in my selection.
Challenges of Implementing Corporate Tax In the UAE
As the Head of Corporate Tax at PKF UAE, my primary responsibility has been to actively engage in the market.
This involves meeting clients, raising awareness about the new tax law, building a strong team, and more.
Most of our team members come from a Big 4 background in India with expertise in both Corporate Tax and Transfer Pricing.
Since the issuance of the final law and the subsequent cabinet and ministerial decisions, we have been delivering results.
Let’s talk about the challenges I initially faced and what other tax professionals should be careful about.
Moving from a Tax jurisdiction, where the Income Tax law is more than 100 years old (Indian Income Tax Act of 1922), to a country that is just introducing Corporate Tax, is anything but a straightforward transition.
The process of implementing a new tax is interesting, but there are certain difficulties.
- First of all, we have to study the law from scratch.
- In a nascent market like the UAE, we may encounter clients who have little knowledge about Corporate Tax, apart from the fact that it is 9%.
- Due to the absence of tax laws, many companies have been operating within a group structure and preparing their financial statements on a consolidated basis. This means that revenues were booked in one company while costs were booked in another.
- We need to emphasize the concept of matching, which is a fundamental accounting principle. It is essential for revenue and costs to align with each other.
- However, explaining this concept to clients and facilitating the necessary changes to their ERPs, and changing established practices can be difficult.
Advising is just one aspect, but when it comes to the actual implementation of these measures, it may require sleepless nights for both us as professionals and our clients.
The past 11 months have been hectic, but exciting nonetheless.
While Tax Professionals are highly sought after with the introduction of the new Tax Law, companies in the UAE tend to hire candidates that have experience in the GCC (Gulf Cooperation Council) region.
The reason is that every region or market has its unique nuances and specific set of laws.
Candidates in the local market would already be acquainted with these nuances and require less time to adapt. This is where local talent becomes advantageous.
Having said that, Indian tax professionals can have a chance, considering they are well-versed in their complex tax laws.
Professionals with 7-10 years of Advisory experience in Corporate Tax and Transfer Pricing and freshers or individuals with 1-2 years of experience are highly sought after.
Additionally, there is a need for senior professionals with over 10-15 years of experience in leadership positions.
This presents a number of opportunities including in,
Consulting firms:
- Consulting firms are actively establishing and expanding their tax practices.
- The demand for professionals at different levels is expected to evolve.
In-House expertise in MNCs:
- Multinational corporations (MNCs) and companies across various industries recognize the need for specialized tax experts.
- While consultants may offer necessary advice, the actual implementation of these solutions requires dedicated in-house personnel.
Closing…
When I was taking the decision to relocate to the UAE, numerous thoughts crossed my mind. I had to build new relationships, adapt to the organization, and gain acceptance from clients.
It is even more difficult when you are already in a well-paying job, so leaving your comfort zone requires courage.
On top of that, if you have children, their education becomes a factor. Or perhaps your aging parents may require your support.
However, in my humble view, implementing a new tax law in a Country is like seeing a newborn child growing, which is very exciting for a Tax professional like me. This experience itself may be a good reason to explore this opportunity and take the risk.
