The tax year is generally the same as the calendar year, although advance approval may be sought from the General Tax Authority to use a company's accounting year-end.
The tax return is due within four months from the end of a company's accounting period.
Payment of tax
The tax payable is based on the tax declaration and should be paid on the same day that the tax return is due.
Late filing penalties
The Qatar tax law contains a penalty regime, which imposes a penalty for the late filing of a tax return. In addition, a penalty applies where there is a late payment of tax.
Objection and appeals process
It is possible for a taxpayer to initially object directly to the General Tax Authority regarding a decision related to a tax position. If the objection is unsuccessful with respect to altering the General Tax Authority’s decision, an appeal may be made by the taxpayer to the Tax Appeals Committee. Based on the Tax Appeals Committee's decision with respect to the appeal, a final appeal may be made by either the General Tax Authority or the taxpayer to the administrative chamber of the court. The law prescribes time limits for each stage of the appeal process.
There is a mandatory requirement to use Arabic language in all the correspondences with the General Tax Authority after 13 July 2019.
Accounting and audit requirements
A company's CIT return is required to be accompanied by audited financial statements if the company's capital or profit exceeds 100,000 Qatari riyal (QAR) or the head office is situated outside Qatar. The audit report must be signed by a Qatar-registered auditor.
Qatar tax law requires accounts to be prepared in accordance with IFRS. For taxable years starting on or after 1 January 2020, there will be a requirement to submit the financial statements in the Arabic language.
Accounting record retention
All accounting books, registers, and documents relating to activities in Qatar are required to be retained in Qatar for a ten-year period.
The Qatar tax law contains anti-avoidance provisions that give the General Tax Authority wide powers to counteract transactions that have been carried out with a tax avoidance purpose. These powers include substituting an arm’s-length value or re-characterising transactions.
Topics of focus for the General Tax Authority
The following areas appear to be the focus of the General Tax Authority from a tax compliance perspective:
- Representative offices of non-residents are being required to file tax returns, notwithstanding the fact that they may only be promoting their business.
- The General Tax Authority is closely examining the taxpayer’s activities to establish whether or not a PE exists. This is a particular area of focus where a taxpayer submits a claim for a refund of WHT on the basis of application of the provisions of a DTT. If a taxpayer has a PE, the Foreign Investment Law requires that PE to be formally registered as a company or a temporary branch.
- Related-party transactions and large and unusual items of expenditure are being scrutinised by the General Tax Authority. See the Group taxation section for comments on the anti-avoidance provision and transfer pricing.
- The allocation of head office general and administrative expenses to a Qatar branch of a foreign company.
- Capital gains generated on the sale of shares by a non-resident in a Qatari company.