What is UAE Corporate Tax Penalty Waiver?
The UAE Ministry of Finance and Federal Tax Authority (FTA) announced a Corporate Tax Penalty Waiver. This is a one-time concession introduced in April 29, 2025. Normally, businesses that fail to do their corporate tax registration on time, will have to bear a hefty fine of AED 10,000, but under the new rule, businesses can get exempted from the fine, provided the taxable person submits the tax return within seven months from the end of the first tax period. Additionally, if the person has already paid the penalty for late registration, the amount will be refunded and credited to the taxpayer’s account.
For example, if your first tax period ended on 31 December 2024, you must file your return by 31 July 2025 to benefit from the penalty waiver.
Why Corporate Tax Penalty Waiver was Introduced?
The FTA had made it clear that the waiver was introduced to:
- Encourage early voluntary registration and filingÂ
- Reduce the financial burden especially for SMEs
- Make UAE the favourite place to start and grow businessesÂ
Who Is Eligible for Corporate Tax Penalty Waiver?
- All taxable businesses and exempted entities : ( LLC, Freezone companies, Private companies, qualifying investment funds, government-controlled entities)
- Companies that file their first corporate tax return or annual report within seven months after the first tax period ends.
- Companies that maintain proper bookkeeping and accounting records and ensure accurateÂ
Steps To Avail The Penalty Waiver
To avail the penalty waiver, companies must:
- Register Corporate tax: Corporate tax registration in Dubai is mandatory, if companies haven’t registered, must initially register for corporate tax in EmaraTax Platform.
- File Corporate Tax Return: Companies must file returns within seven months from the end of your first tax period.
- Monitor Tax Account: If you have already paid the penalty, check for the refund credited to your tax account.
- Get expert assistance: Get an expert Corporate tax service in UAE for processing corporate tax waiver and all the corporate tax registration and filing services.
Key Deadlines and Tax Period
| Company Incorporation Date | Tax Period | Last Day to File |
|---|---|---|
| Jan 1, 2024 | Jan 1 – Dec 31, 2024 | July 31, 2025 |
| July 1, 2024 | July 1, 2024 – June 30, 2025 | Jan 31, 2026 |
| Nov 1, 2024 | Nov 1, 2024 – Oct 31, 2025 | May 31, 2026 |
Ensure Compliance Now and Maximize Relief
The UAE Corporate Tax Penalty Waiver 2025 gives businesses an opportunity to comply with tax regulations and avoid penalties. Intellect Chartered Accountants is here to assist you with end-to-end corporate tax services. Being one of the leading chartered accountants in UAE, we offer expert guidance and complete support for corporate tax services, including corporate tax registration, filing, and compliance. We ensures that your business meets all the FTA requirements. Take note of the deadlines and make sure to file your corporate tax returns on time to avoid penalties and stay compliant.
