CORPORATE TAX

Corporate Tax Registration In Dubai

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Introduction To Corporate Tax

On 31 January 2022, the UAE Ministry of Finance announced the introduction of Federal Corporate Tax in UAE on business profits which will come into being for financial years starting on or after 1st June 2023. The tax will be levied on all corporations and commercial activities in the country, except for the “extraction of natural resources” which will remain subject to emirate level taxation. The government will continue to honour the corporate tax incentives being offered to free zone businesses that meet all regulatory requirements and that do not carry out business in the UAE mainland. For small businesses with taxable profits not exceeding AED 375,000 (approximately USD 102,100) 0% is incurred to facilitate the development of startups. This new regime intends to support small businesses along with global operations. However Corporate tax premises are quite new for businesses and call for professional assistance to comply with the updated tax regulations.

Applicable Rates Of Corporate Tax In UAE

Corporate tax applies to diverse businesses as follows:

  • 0%, for taxable income not exceeding AED 375,000
  • 9%, for taxable income exceeding AED 375,000
  • a different tax rate (to be specified) for large multinational companies meeting specific criteria set with reference to Pillar II of the OECD BEPS.

Corporate Tax Exemptions

The following entities are exempted from the premises of corporate tax.

  • Businesses involved in the extraction of natural resources
  • Dividends and capital gains made by UAE businesses from its sales of shares
  • Qualifying intra-group transactions and reorganizations meeting the necessary conditions

Corporate Tax Registration in UAE

All registered businesses in the UAE are subjected to Corporate tax. A business subject to Corporate Tax will have to register with the FTA. After registration, a Tax Registration Number will be obtained within a prescribed period.

How Can MAATS Help?

Our tax consultants will help you determine whether or not your business is subjected to the premises of CIT. From the process of registration, certification, and submission of required documents, to the successful establishment of business, our tax specialists at MAATS will guide you Corporate tax registration in Dubai through the processes as smooth as possible. We never make things late; as timely panning and submission are critical in reducing the client’s pressure to complete the preparations on time. With a holistic approach to tax consulting and bookkeeping, MAATS provide services in Corporate tax accounting, Corporate tax planning, VAT consulting services and company set-up. Feel free to reach out to us with your requests and queries!

Frequently Asked Questions

Currently, there is no separate registration fee for corporate tax. However, businesses will need to pay taxes based on their profits once they are registered.
Yes, businesses can complete the corporate tax registration process online via the UAE Federal Tax Authority (FTA) website.
The process typically takes a few days to a few weeks, depending on how quickly the required documents are submitted and processed by the FTA.
Failure to register on time can result in penalties and fines. It is essential to complete the registration before the deadline to avoid such consequences.
Penalties for failing to register on time may include fines, interest on overdue tax, and possible legal action. It is critical to comply with the registration requirement.
While it’s not mandatory to hire a consultant, it is highly recommended, especially for businesses unfamiliar with the registration process or the new tax laws.
Any significant changes to your business structure, such as mergers, changes in ownership, or business activity, must be updated with the FTA. This can be done via the FTA’s online portal.
After registration, businesses are required to file annual corporate tax returns, maintain tax records, and pay any taxes owed based on their taxable profits.
Some businesses, particularly those in free zones, may be eligible for temporary tax exemptions or special tax rates, depending on the specific provisions of the free zone regulations.
The deadline for filing corporate tax returns is 9 months after the end of your business’s financial year. This deadline can vary depending on the business’s financial year-end.