How to File Corporate Tax in UAE: Complete Guide 2024
Understanding Corporate Tax in UAE
The UAE introduced Federal Corporate Tax (CT) effective from June 1, 2023, marking a significant shift in the country's tax landscape. This comprehensive guide will walk you through everything you need to know about filing corporate tax in the UAE.
Who Needs to Register for Corporate Tax?
Corporate Tax applies to all UAE businesses and commercial activities, with few exceptions. This includes:
- All UAE companies and other juridical persons
- Natural persons conducting business or business activity in the UAE
- Non-resident persons who have a permanent establishment in the UAE or earn UAE-sourced income
- Free Zone persons who do not meet the qualifying income criteria
Corporate Tax Rates in UAE
- 0% - Taxable income up to AED 375,000
- 9% - Taxable income exceeding AED 375,000
- Different rate - Large multinationals meeting specific criteria
Step-by-Step Filing Process
- Register for Corporate Tax: Complete registration through the Federal Tax Authority (FTA) portal within 3 months of exceeding the registration threshold.
- Maintain Proper Records: Keep accurate financial records and supporting documents for at least 7 years as per UAE regulations.
- Prepare Financial Statements: Ensure your financial statements comply with internationally accepted accounting standards.
- Calculate Taxable Income: Apply the correct adjustments to accounting profit to arrive at taxable income.
- File Tax Return: Submit your corporate tax return within 9 months of the end of your tax period.
- Make Payment: Pay any tax due within the prescribed timeline to avoid penalties.
Important Deadlines
Tax returns must be filed within 9 months of the end of the relevant tax period. For example, if your tax period ends on December 31, 2024, your tax return is due by September 30, 2025. Late filing can result in penalties ranging from AED 500 to AED 10,000.
Common Mistakes to Avoid
- Missing registration deadlines
- Incorrect calculation of taxable income
- Failing to maintain proper documentation
- Not applying for available exemptions and reliefs
- Ignoring transfer pricing requirements for related party transactions
Need Expert Assistance?
Corporate tax compliance can be complex. Our team of certified tax professionals can help you navigate the registration process, ensure accurate filing, and optimize your tax position within the legal framework.
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