Corporate tax registration UAE is considered a major step towards developing the tax structure, as this tax is a type of direct tax imposed on the profits and income of companies and institutions, with the aim of enhancing the UAE’s position as a preferred destination for business and investment.
We at Alsun for Corporate Tax Registration UAE always strive to provide support and guidance to our clients regarding corporate tax, enabling them to comply with laws and regulations with complete efficiency and preparedness.
Contents
- 1 Registration for Corporate Tax in UAE
- 2 How to Register for UAE Corporate Tax?
- 3 Need for Corporate Tax Registration in UAE
- 4 Who is Exempt from UAE Corporate Tax?
- 5 Who Should Register for Corporate Tax?
- 6 Timeline for Corporate Tax Registration
- 7 Why Corporate Tax Assessment is Necessary Before Registration?
- 8 Corporate Tax Registration Services
- 9 Understanding Corporate Tax in the UAE
- 10 Steps to Register for Corporate Tax in the UAE
- 11 UAE Corporate Tax Registration Mandatory for Medium and Small Enterprises, Even with Losses
- 12 Corporate Tax Registration: A Non-Negotiable Step in 2024
- 13 Small Business Relief: A Lifeline for Eligible Entities
- 14 Comparing VAT and Corporate Tax
- 15 UAE Corporate Tax Deregistration
- 16 UAE Corporate Tax Return Filing
- 17 UAE Corporate Tax Deadlines
- 18 Exemptions from UAE Corporate Tax
- 19 Corporate Tax Rate for Free Zones
- 20 How much is corporate tax in the UAE?
- 21 Best Corporate Tax Agency in UAE
- 22 Conclusion
- 23 FAQS
Registration for Corporate Tax in UAE
All taxable persons must register for corporate tax in accordance with the Corporate tax registration UAE law. Branches in the UAE of a local or foreign legal entity are an extension of the parent entity and are not considered separate legal entities, and therefore registration or filing of returns separately from the parent company is not applied.
At Alsun Corporate Tax Registration guide, we provide assistance on who has to register for corporate tax in uae and guidance on all aspects of corporate tax.
This includes the process of how to register for corporate tax and comply with the requirements of the new law, where companies can receive assistance in determining the procedures necessary to register for corporate tax and obtain the required TRN.
We are proud to provide high-quality services and comprehensive guidance to our clients in the process of how to register for corporate tax, ensuring their compliance with tax laws and their smooth transition to the new tax system. Based on our expertise and practical experience, we ensure that our clients receive full support and professional advice on all aspects of corporate tax.
How to Register for UAE Corporate Tax?
The Corporate tax registration UAE rate varies based on the taxable income and the legal framework of the person or entity subject to the tax. For example, we find tax exemption for new companies or natural individuals for those whose income is less than 375,000 UAE dirhams.
Regardless of whether they practice one business or multiple businesses. And 9% for those who exceed this amount, and the tax rate may differ for large multinational companies that follow specific standards.
As for the qualified person residing in the free zone, we find that the rate is 0% on qualified income, as specified in Cabinet Resolution No. (55) of 2023, and 9% on taxable income
Need for Corporate Tax Registration in UAE
The new tax law aims to achieve a balance between strengthening the state’s financial structure and encouraging business, by imposing a competitive tax rate on corporate income based on recognized international accounting standards.
You have completed the procedures related to tax registration and attached the necessary data and documents for that. The Federal Tax Authority will process your application within 20 days from the date of its receipt.
However, if the Authority needs additional information, it may take more time. You must then resubmit the application along with the additional information, at The Authority must respond to the updated request within 20 days from the date of its submission.
It should be noted here that the Authority will automatically reject the application if you do not resubmit the application within 60 days from the date of receiving the notice from the Authority.
Who is Exempt from UAE Corporate Tax?
- Dividends from stocks or shares: This category includes dividends received from legal entities established or resident in the country.
- Profits from participation interests in a foreign legal person: Profits from participation interests in foreign entities are excluded from corporate tax.
- Other types of income: This category includes income earned on capital, foreign exchange gains/losses, and impairment gains or losses, based on specific criteria.
- Income from foreign branches or permanent establishments: Income generated from a foreign branch or permanent establishment that has been selected for exemption through the “Permanent Establishment Exemption” application is excluded.
- Income earned by a non-resident person from operating or leasing aircraft or ships in international traffic when certain conditions are met.
These categories of income are excluded from corporate tax in the UAE, which contributes to enhancing the investment and business climate in the country
Who Should Register for Corporate Tax?
who has to register for corporate tax in uae?
- Local companies: Includes companies that have been established, established, or recognized under the legislation in force in the United Arab Emirates.
- Foreign companies: Includes companies that have been established, created, or recognized in accordance with the laws in force in a foreign territory or another country, provided that their main decisions from the commercial and administrative aspects are taken in the country in a way that achieves the factors of effective management and control in the country.
- Natural persons: if they practice any business or business activities in the country.
- Non-resident companies in the country: if they own a permanent establishment or achieve qualifying income in the country.
- These persons and companies are obligated to register for corporate tax in accordance with the tax legislation in force in the United Arab Emirates.
Timeline for Corporate Tax Registration
You have completed the procedures related to tax registration and attached the necessary data and documents for that. The Federal Tax Authority will process your application within 20 days from the date of its receipt.
However, if the Authority needs additional information, it may take more time. You must then resubmit the application along with the additional information, at The Authority must respond to the updated request within 20 days from the date of its submission.
It should be noted here that the Authority will automatically reject the application if you do not resubmit the application according to the Corporate tax registration deadline.
Why Corporate Tax Assessment is Necessary Before Registration?
Corporate tax registration fees in UAE is applied in accordance with the new law to all businesses and individuals that conduct their activities under an industrial, commercial, or professional permit in the country.
The law includes institutions working in construction, real estate development, real estate management, real estate agencies, and foreign companies that conduct regular or ongoing commercial activity within the country.
Corporate tax registration UAE is imposed on the income of companies exceeding 375 thousand UAE dirhams at a rate of 9%, and if the total income is less than the mentioned amount, the rate is 0%.
Corporate Tax Registration Services
The Corporate tax registration UAE service provided by the Federal Tax Authority aims to enable legal persons and individuals in the UAE to comply with corporate tax requirements. Through this service, people are registered for corporate tax and obtain the corporate tax registration number necessary to perform their tax obligations.
Understanding Corporate Tax in the UAE
The Ministry of Finance of the United Arab Emirates issued Federal Decree Law No. 47 of 2022 dated December 9, 2022 regarding the imposition of tax on institutions and companies. The Federal Tax Authority stipulates that companies are subject to corporate tax.
At the rate of 9% from the beginning of the fiscal year beginning on or after June 1, 2023. The UAE has become the fourth country among the Gulf Cooperation Council countries to implement a federal corporate tax.
Corporate tax aims to help the UAE accelerate its development and transformation, position the country as a world-leading business hub, and ultimately achieve its strategic goals. Furthermore, the UAE government bases its corporate tax system on global best practices and incorporates internationally accepted principles.
Steps to Register for Corporate Tax in the UAE
The Federal Tax Authority has launched early registration under the corporate tax system through the EmaraTax portal. And explained the following:
- Early registration facility is available from January 2023 to May 2023 for select companies operating in the UAE.
- These selected companies will receive invitations from the Federal Tax Authority via email and SMS.
- After this stage, the Federal Tax Authority will open the registration window for companies and other institutions.
- It will give sufficient time for companies to apply for registration.
- Also, when registration opens, priority will be given to companies whose fiscal year begins on June 1, 2023.
Recently, the Federal Tax Authority invited all public joint stock companies and private companies (resident for corporate tax purposes) to register under UAE corporate tax from 15 May 2023 onwards.
This stage does not include people in the free zone. Furthermore, corporate tax registration for other categories of taxable persons, such as natural persons, will be opened at a later date.
UAE Corporate Tax Registration Mandatory for Medium and Small Enterprises, Even with Losses
All companies and businesses generating taxable income in the UAE are subject to corporate tax registration, including:
- Limited Liability Companies (LLC).
- Closed joint stock companies.
- Individual institutions.
- Partnership entities.
- Branches and permanent establishments of foreign companies.
- Any other entity considered by UAE law to be a legal person.
- Therefore, whatever the legal form of your business activity, UAE law still considers it a legal person. You are obligated to register for corporate tax.
Corporate Tax Registration: A Non-Negotiable Step in 2024
The Federal Authority for Land and Maritime Transport issued Resolution No. Law No. (3) of 2024 regarding the required time limits. This decision takes effect as of March 1, 2024. On June 4, 2024, the Federal Tax Authority issued a “general clarification regarding corporate tax” entitled “Timelines for Registration for Taxable Persons in Corporate Taxes,”.
Which clarifies The timelines in which a taxable person is required to submit a tax registration application to the FTA for corporate purposes. The clarification mentions different registration timelines for different taxable persons with several illustrations to explain how it applies to them.
Any taxable person who delays submitting a tax registration application within the timeline specified by the Federal Tax Authority will be subject to an administrative fine of 10,000 dirhams.
Small Business Relief: A Lifeline for Eligible Entities
Before registering for corporate tax, companies must collect the necessary information and documents. Ensuring that all details are accurate will speed up the registration process and avoid delays or rejection. Documents required for registration:
- Business License: A valid business license is necessary.
- Financial Statements: Recent financial reports to verify income limits.
- Bank account information:
- Contact information: including the registered address of the company and contact information of the authorized person.
Comparing VAT and Corporate Tax
Value-added tax is very similar to the sales tax that is imposed on goods, but it is more efficient and effective, as the added tax law in the UAE stipulates that a rate of 5% is imposed on most goods and services that are supplied to the UAE at every stage of the supply chain. The final consumer bears the full cost of this tax, meaning that the buyer or beneficiary of the service will pay this tax in the end.
Corporation tax is a form of direct tax imposed on the net income or profit of a business. In some other countries, corporate tax is referred to as “corporate income tax” or “business profits tax.” Corporate tax is subject to Federal Decree Law No. 60 of 2023 amending some provisions of Federal Decree Law No. (47) of 2022 regarding corporate and business tax.
UAE Corporate Tax Deregistration
One of the advantages of investing in the UAE is that it imposes taxes at a relatively lower rate compared to most other countries. There is – so far – no income tax, inheritance tax, or withholding tax, and there are no restrictions on repatriating profits abroad.
Moreover, it does not matter how much you earn from your personal investments, whether it is stocks or otherwise, your private income is tax-free if you hold a residence visa in the UAE, and do not have official residency outside the country.
UAE Corporate Tax Return Filing
The 5% Corporate Tax registration threshold UAE applies to a wide range of categories, from entertainment, electronics and hotel services to food and drink and transport.
According to the law, companies whose taxable exports and imports exceed 375 thousand dirhams annually must register with the Tax Authority and submit a value-added tax return.
However, Corporate tax registration UAE can apply for a refund for qualifying business expenses such as travel, entertainment and office supplies, and if you engage in these activities frequently, it could bring you significant financial savings.
UAE Corporate Tax Deadlines
After submitting your Corporate tax registration UAE, the Federal Tax Authority will review your application. You will receive a confirmation email within approximately 20 working days, along with your Tax Registration Number (TRN). If any issues arise during the review process, you may be asked to provide additional information.
Exemptions from UAE Corporate Tax
To be eligible for the Corporate tax registration UAE, your company must meet the following criteria:
- It must be a person residing in the UAE, which means that it is an entity established in the UAE or a foreign entity that is effectively managed and controlled within the country.
- Corporate and small business revenues cannot exceed AED 3 million (US$816,904 thousand) during the relevant tax period and for all tax periods ending on or before December 31, 2026.
- The above revenue limit applies beginning June 1, 2023 or later.
- A small business cannot operate as a financial institution or holding company.
- The Small Business Exemption Program must be elected on the tax return.
- The exemption can be claimed for multiple consecutive tax periods if specific eligibility criteria are met.
Corporate Tax Rate for Free Zones
The Corporate tax registration UAE rate varies based on the taxable income and the legal framework of the person or entity subject to the tax. For example, we find tax exemption for new companies or natural individuals for those whose income is less than 375,000 UAE dirhams.
Regardless of whether they practice one business or multiple businesses. And 9% for those who exceed this amount, and the tax rate may differ for large multinational companies that follow specific standards.
As for the qualified person residing in the free zone, we find that the rate is 0% on qualified income, as specified in Cabinet Resolution No. (55) of 2023, and 9% on taxable income that is not qualified income.
To avoid overlapping calculations with each other, you can book a free consultation with one of Absher’s experts to clarify all the details regarding the UAE tax system that must be taken into consideration when establishing a company in Dubai.
How much is corporate tax in the UAE?
As for how to calculate the corporate tax (CT), the Ministry of Finance announced the issuance of a new tax law for companies, as the law stipulates that a federal corporate tax of 9% in the United Arab Emirates be calculated on business income with a minimum of 375 thousand UAE dirhams.
Starting from the fiscal year in which It begins on June 1, 2023. As for businesses whose income is less than 375 thousand UAE dirhams, they fall under the list of companies exempt from tax. Once you submit an official application to the Federal Tax Authority, you will be able to obtain a tax number (TRN) for your company.
Best Corporate Tax Agency in UAE
Alsun Tax Agency in UAE boasts a team of seasoned tax professionals committed to providing top Accounting and Tax Services.
we ensure your tax residency certificate application is handled accurately and efficiently. Rely on our experts for precise and professional tax solutions.
Conclusion
In conclusion, the goal of introducing the corporate tax law is to support the country and achieve its strategic goals, by accelerating the pace of growth and development.
The corporate tax law in the UAE is competitive and adheres to international standards, and is considered an ideal and better option than the tax laws of other countries in the world.
The UAE is always keen to ensure that its taxes are low and competitive among the countries of the world, and that it has the lowest tax rate among the countries of the Gulf Cooperation Council.
FAQS
What are deductible expenses in the UAE?
In principle, all legitimate business expenses incurred wholly and exclusively for the purposes of generating taxable income are deductible, although the timing of the deduction may vary depending on the types of expenses and accounting methods applied. For capital assets, expenditures are generally incurred by deducting depreciation or amortization over the economic life of the asset or benefit.
What is the deadline for corporate tax registration in UAE?
Companies whose fiscal year is from June 1 to May 31 will have tax registration open for them during the period extending between (January 1) of the year 2023 and (February 28 of the year 2025).
Companies whose fiscal year is from January 1 to December 31 will have tax registration open during the period between January 1, 2023 and September 30, 2025.