UAE Corporate Tax Registration: Companies may need to register for corporate tax, even if they are already VAT registered.
Starting June 1, 2023, corporate taxes will be implemented on businesses in the UAE. To effectively handle these new regulations, it is important to understand the administrative responsibilities like tax registration, deregistration, submitting corporate tax declarations, and settling payments. Consulting with a corporate tax advisor in Dubai can provide valuable insights into meeting compliance requirements and avoiding hefty fines in the UAE.
Registering for Corporate Tax in the UAE: Procedures and Deadlines.
To comply with the regulations, companies operating in the UAE are required to undergo registration with the Federal Tax Authority and obtain a unique identification or registration number for corporate tax purposes.
The corporate tax registration process applies to all businesses, regardless of whether they are liable for a 0% or 9% UAE Corporation Tax rate. To assist you in fulfilling your tax obligations, there is a selection of corporate tax advisors available in the UAE who specialize in various aspects of tax registration.
As per the details mentioned on the FTA website, individuals liable for taxation are required to register by the date of their initial tax filing. To illustrate, if an individual’s fiscal year concludes on May 31st, they have a window of 26 months to complete their registration, which extends until February 28th, 2025. Likewise, individuals with a financial year ending on December 31st have a registration period of 33 months available, concluding on September 30th, 2025.
The FTA has released a user guide containing instructions and guidelines on how to utilize the EmaraTax portal. Here is a summary of the procedure for corporate tax registration in the UAE.
Deregistration of Corporate Tax in the UAE
If your company is registered for corporate tax in the UAE, it is necessary to deregister it before it is no longer liable for corporate tax. The FTA will proceed with the deregistration process once all corporate tax returns have been filed, all tax liabilities have been settled, and any penalties due up to the date of cessation have been paid.
Filing the Corporate Tax Return in the UAE
For the filing of corporate tax returns in the UAE, it is mandatory for businesses to submit a single consolidated tax return instead of multiple returns. This consolidated return must be filed within nine months after the completion of each relevant tax period.
If you would like further information regarding e-filing corporate tax returns in the UAE, please feel free to get in touch with us at Intellect Chartered Accountants, located in Dubai, UAE.
Deadlines for Corporate Tax in the UAE
The self-assessment principle forms the foundation of the corporate tax regime, wherein businesses bear the responsibility of ensuring the accuracy and compliance of the documents they provide to the FTA.
Taxpayers in the UAE now have a generous timeframe of 21 months from the commencement of their financial year to adequately prepare for tax filing and fulfill their tax obligations.
For instance, companies that have a fiscal year commencing on June 1, 2023, and concluding on May 31, 2024, are required to submit their corporate tax returns and settle their payments by February 28, 2025.
The tax return and payment for a business with a first tax period starting on January 1, 2024, and ending on December 31, 2024, should be submitted between January 1 and September 30, 2025.
UAE Corporate Tax exemptions
- Businesses involved in extracting natural resources are not required to pay corporate tax, as they will continue to be subjected to the existing corporate taxation at the Emirate level.
- The UAE business will not be subject to CT on the dividends and capital gains it earns from its qualifying shareholdings.
- Intra-group transactions and reorganizations meeting the required conditions will be exempt from CT.
The corporate tax rate in the United Arab Emirates
The tax rate is 0% for taxable income up to AED 375,000, while 9% for taxable income exceeds AED 375,000.
Corporate Tax rate applicable for freezones
Free Zone enterprises in the UAE will be liable to pay Corporate Tax. Nevertheless, it has been made clear that the Corporate Tax system will still acknowledge the corporate tax benefits presently provided to free zone businesses that adhere to all regulatory obligations and refrain from conducting business in the mainland UAE. Enterprises established in a free zone must register and submit a Corporate Tax Return.
