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Corporate Tax in UAE
Table of Contents
What’s the Corporate tax?
Corporate tax (CT) was introduced by the UAE Ministry of Finance; it’s a direct tax applied on the net profit of most businesses operating in the UAE.
So, whether you’re a small business owner, a freelancer, or a multinational company owner, understanding the UAE Tax Laws is very important for your business to stay compliant and protect it from unnecessary fines and penalties.
What’s the tax rate?
Corporate Tax Registration Law
Who Needs to Register for UAE taxes?
Mandatory Registration for businesses earning over AED 375,000 a year.
Voluntary Registration for businesses earning between AED 187,500 and AED 375,000.
Free Zone Entities: Many Free Zone companies can enjoy 0% tax if they meet the exact compliance requirements, but they still need to register and file returns.
Exempt Entities: Certain organizations such as government bodies, public benefit entities, and qualifying investment funds are exempt but must apply for exemption with supporting documents.
So, whether you’re operating your business on the mainland, in a free zone, or offshore, it’s critical to understand your obligations.
The tax rate in the UAE is only 9%, which is one of the lowest rates globally, making UAE the most attractive market for investors, and allowing business owners to live, work, and earn profits without a heavy tax burden.
Tax Registration Process in UAE
To register for corporate tax:
- You have to create an e-service account here: Federal Tax Authority
- Then, select “Corporate Tax Registration”
- Submit your business information, required documents, and apply.
- After approval you’ll receive your Tax Registration Number (TRN) and begin filing your taxes correctly.
**Important Note: Please review and double-check all the information and documents before submitting the request to avoid rejection.
What happens if I don't register for TAX?
Ignoring the taxes regulations in the UAE can lead to serious consequences, your business will be fined, penalized, and even suspended.
Here’s what to avoid while registering:
- Incorrect information: Avoid submitting incorrect or missing information while filing the tax request, it may lead to delays and rejection.
- Late registration: Missing the corporate tax registration deadline = AED 10,000 fine.
- Late file returns: Late submission of corporate tax returns results in a fine of AED 500 for each month of delay during the first 12 months. Starting from the 13th month, the fine increases to AED 1,000 for each month of delay.
- Assuming you’re exempt from taxes: For most Free Zone areas, business owners think they might be exempt from corporate tax but without a proof. The FTA requires proof and application for any exemptions.
Ignoring taxes for small businesses: Even small businesses need to register for tax and file returns, so ignoring this can lead to issues down the line.
How can HBCS help?
At HBCS, we understand that tax regulations can be complex and draining, that’s where we come in.
We support clients across all industries and areas. If you’re setting up a new company in the UAE or have been operating for years, our team helps you with the full process according to your needs.
Our Corporate Tax Services include:
- Corporate Tax registration with the FTA.
- Compliance checks to make sure you meet all legal requirements.
- Filing tax returns and reporting support to avoid fines and penalties.
- Ongoing consultancy and advisory to help you optimize your tax position.
We also provide customized support for Free Zone companies, making sure they maintain their 0% tax status while remaining compliant.
Book your FREE Consultation today!
Let’s make tax registration smooth, clear, and 100% accurate.
Faq
Frequently Asked Questions
Who must register for Corporate Tax?
All “taxable persons” having business in the UAE must register with the FTA for CT.
This includes:
1-UAE companies (Offshore/Free zone/Mainland).
2-Branches of foreign companies in the UAE.
3-Natural persons who have business activity in the UAE must register.
In general, any UAE-resident business must have a CT Tax Registration Number (TRN) via the FTA’s EmaraTax portal.
2-How do I register for Corporate Tax?
The registration process is quite simple; all you have to do is create an e-service account via the FTA’s EmaraTax system, choose “Corporate Tax Registration” and start filling the required information accurately.
Are Free Zone companies automatically exempt?
No, Free Zone companies can benefit from a 0% tax rate if they meet the strict conditions first. Companies that don’t meet these conditions will be subject to the standard 9% corporate tax rate.
Can I skip tax registration if my business doesn't meet the threshold?
No, all operating companies in the UAE must register for taxes even if their profit doesn’t meet threshold.
When is the Tax filing deadline?
Businesses have nine months after their financial year to meet the corporate tax filing deadline. If you do not pay your taxes by the due date, you risk getting penalized by the Federal Tax Authority.
