Bookkeeping

• Corporate Tax (CT) is a direct tax levied on the net income or profit of corporations and other businesses. CT is also referred to as “Corporate Income Tax” or “Business Profits Tax” in other jurisdictions.
• A competitive CT regime based on international best practices is expected to cement the UAE’s position as a leading global hub for business and investment and accelerate the UAE’s development and transformation to achieve its strategic objectives. The introduction of a CT regime also reaffirms the UAE’s commitment to meeting international standards for tax transparency and preventing harmful tax practices.
• The UAE CT regime has become effective for financial years starting on or after 1 June 2023.

• A business with a financial year starting on 1 July 2023 and ending on 30 June 2024 will become subject to UAE CT from 1 July 2023 (the beginning of the first financial year starting on or after 1 June 2023).
• A business with a financial year starting on 1 January 2023 and ending on 31 December 2023 will become subject to UAE CT from 1 January 2024 (the beginning of the first financial year starting on or after 1 June 2023).

Every taxable person, including Free Zone Persons, must register with the Federal Tax Authority (FTA) under the CT Law regime. Every person carrying out business or business activities in the UAE under the license must obtain a tax registration number.

All the Taxable persons must register under the Corporate Tax regime as per the timeline prescribed by FTA via decision no.3 of 2024.

On 28 February 2024, Federal Tax Authority (FTA) has released decision no.3 of 2024 stating the Timeline for Registration of Taxable Persons for the Purposes of Federal Decree-Law No. 47 of 2022 on the Taxation of Corporations and Businesses and its amendments. The key highlights of the decisions are outlined below: -

• Effective date of this Decision is March 1, 2024.
• In our view, first issue month (Original Issuance date mentioned in the Trade License) is to be considered for determining the deadline for CT registration.
• The earliest Deadline for submission is 31 May 2024 for the companies that have January or February as the license issue month.
• Penalty of AED 10,000 will be imposed on non-submission of Corporate Tax Registration application rather than on obtaining Corporate Tax Registration Number from Emara Tax Portal.

1. A Timeline for Tax Registration of Resident Juridical Persons that are incorporated or established or recognised before March 1, 2024 are: –

Month of Issue of License irrespective of year of issuance of license Deadline for Submitting a Tax Registration application  

1 January - 31 January31 May 20241 

February - 28/29 February31 May 20241 March - 31 March30 June 20241 

April - 30 April30 June 20241 

May – 31 May31 July 20241 

June - 30 June31 August 20241 

July – 31 July30 September 20241 

August – 31 August31 October 20241 

September – 30 September31 October 20241 

October – 31 October30 November 20241 

November – 30 November30 November 20241 

December – 31 December31 December 20241

If a person does not have a license on March 1, 20243 Months from 1 March 2024 (i.e., before the end of May 2024)

For resident Juridical person that have more than one license, in such case the license that was issued earliest shall be considered.

2. Timeline for Tax Registration of Resident Juridical Persons that are incorporated or established or recognized on or after March 1, 2024: –

Category of juridical persons Deadline for Submitting a Tax Registration application A person that is incorporated or established or recognized under the applicable legislation in the State, including a Free Zone Person.3 months from the date of incorporation, establishment or recognition. A person that is incorporated or established or recognized under the applicable legislation of a foreign jurisdiction that is effectively managed and controlled in the UAE.3 months from the end of the Financial Year of the person.

3. Timeline for Tax Registration of Non-Resident Juridical Persons: –

• Became non-resident taxpayer before 1 March 2024:
  • A person that has a Permanent establishment in UAE: must register within 9 months from the date the permanent establishment came into existence.
  • A person that has Nexus in the UAE: must register within 3 months from 1 March 2024 (i.e. before the end of May 2024).
• Became non-resident taxpayer on or after 1 March 2024:
  • A person that has a Permanent establishment in UAE: must register within 6 months from the date the permanent establishment comes into existence.
  • A person that has Nexus in the UAE: must register within 3 months from the date the nexus was established.

4. Timeline for Tax Registration of Natural Persons:

• Resident Natural Persons whose total turnover exceeds AED 1 Mn in a Gregorian calendar year (January-December): before31 March of the subsequent Gregorian year
• Non-residents Natural Person conducting a Business or Business Activity during the 2024 Gregorian calendar year or subsequent years whose total Turnover derived in a Gregorian calendar year exceeds AED 1 Mn: within 3 months from the date the individual became a UAE taxpayer.

5. An administrative penalty of Dh10,000 will be imposed for late registration of UAE Corporate Tax. This penalty is applicable to businesses that fail to submit their Corporate Tax registration applications within the aforementioned timelines set by the FTA.

EmaraTax Platform is the Official website managed by the FTA (Federal Tax Authority of the UAE) that offers various digital services to UAE Businesses. The services include handling Tax Registration, Filing of Returns, Payment of Taxes and Applying for tax refunds under the UAE CT Law regime. Read further to know how to register for corporate tax in UAE.

Documents required for CT Registration on EmaraTax Portal:

• Certificate of Incorporation and Copy of all the latest Trade licenses.
• Copy of Memorandum of Association & Articles of Association / Partnership Agreement or any other document showing ownership information about the business.
• Registered office address.
• Financial Year adopted by a Taxable person to prepare financial statements.
• Copy of the latest Emirates ID and Passport of the Owners/shareholders, along with details of their shareholding in the business.