Corporate Tax Registration

Corporate tax, a vital aspect of business finance, is the tax levied on companies' profits. Corporate Tax in the UAE, as mandated by the Federal Decree Law 47, is a significant fiscal responsibility for businesses. The Federal Tax Authority (FTA) regime necessitates every taxable entity, including Free Zone Persons, to register for Corporate Tax and obtain a Registration Number. The law further stipulates that even exempted persons must register for corporate tax.

At Filings.ae, we specialize in guiding businesses through this mandatory registration. Our expert team provides invaluable assistance in understanding these requirements and facilitating the Corporate Tax Registration process.

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Corporate Tax

Corporate tax, often known as corporate income tax or business profits tax, is a type of direct tax imposed on the net earnings of corporations and various other business entities.

Applicability of Corporate Tax

The UAE Corporate Tax applies to various entities, including resident persons, free zone entities, and non-residents engaged in business within the UAE.

This also encompasses non-resident entities that have a permanent establishment in the country.

• For natural persons, the Corporate Tax is applicable only if their total annual turnover exceeds AED 1 million.
• Resident juridical persons are liable for Corporate Tax on their worldwide income, whereas resident natural persons are taxed only on income generated from business activities within the UAE.
• Non-resident entities, on the other hand, are subject to Corporate Tax under specific conditions:
• Income generated through a permanent establishment in the UAE.
• Income sourced from the UAE that is not attributable to a permanent establishment.
• Income linked to any immovable property in the UAE, reflecting the nexus of the non-resident person in the country.

Exemptions from UAE Corporate Tax

Automatically Exempt:

• Government Entities
• Government-Controlled Entities Specified in a Cabinet Decision

Exempt with Notification to the Ministry of Finance (subject to conditions):

• Extractive Businesses
• Non-Extractive Natural Resource Businesses

Exempt as Listed in a Cabinet Decision:

• Qualifying Public Benefit Entities
• Exempt with Federal Tax Authority Approval (subject to conditions)
• Public or private pension and social security funds

Qualifying Investment Funds

• Wholly owned and controlled UAE subsidiaries of government entities, government-controlled entities, qualifying investment funds, or pension and social security funds.

Taxable Person under Corporate Tax

Classification of Taxable Person for Corporate Tax Purposes

• Resident Person: The scope of taxation for a Resident Person encompasses income originating from both domestic and international sources.
• Non-Resident Person: In contrast, a Non-Resident Person is subject to taxation solely on the income that is sourced from within the UAE.

Corporate Tax Rates

The Corporate Tax rates in the UAE are as follows:

For Resident Taxable Persons:

• Taxable Income not exceeding AED 375,000 : 0% Corporate Tax rate.
• Taxable Income exceeding AED 375,000: 9% Corporate Tax rate.

For Qualifying Free Zone Persons

• 0% Corporate Tax rate.
• Taxable Income that does not meet the Qualifying Income definition: 9% Corporate Tax rate.

Corporate Tax Registration

As per the FTA's Federal Decree Law 47, The corporate tax regime demands that every taxable person, including a Free Zone Person, register for Corporate Tax and get a Registration Number.

FTA also requested that even the Exempted Persons register for Corporate Tax.

The Federal Tax Authority (FTA) mandates that Taxable Individuals or Independent Partnerships must undergo Corporate Tax registration and secure a Tax Registration Number. After completing corporate tax registration, individuals must remit a 9% standard Corporate Tax on taxable income exceeding AED 375,000, with a 0% charge applicable to taxable income up to AED 375,000.

Procedure for Corporate Tax Registration

The Federal Tax Authority (FTA) has enabled pre-registration for corporate tax on the EmaraTax platform. EmaraTax is an online portal where taxpayers can manage various tax-related activities, including registrations, returns, refunds, deregistration, and payments, all in one place

Requirements for Corporate Tax Registration: For UAE Corporate Income Tax (CIT) registration, businesses must submit the documents to the Federal Tax Authority (FTA) online. The required documents differ based on the type of applicant:

For Natural Persons:

• Trade license (if applicable).
• Passport and Emirates ID of the applicant.

For Juridical Persons:

• Trade license.
• Passport and Emirates ID of the authorized signatory.
• Proof of authorization for the authorized signatory.

Corporate Tax Registration Timeline

As per the new cabinet decision released in February, the UAE's Federal Tax Authority (FTA) has established specific timelines for taxable persons to register for corporate tax with the authority. These deadlines are outlined in a new FTA Decision that took effect on 1 March 2024. Below, we have given the corporate tax registration deadline timeframes for both UAE juridical and natural persons,

For Juridical Persons:

Below, we have given the deadline timeframes for resident and non-resident persons come under the juridical category,

Resident Persons Started before March 1, 2024:

Resident Persons in the UAE and were incorporated, established, or otherwise recognized before 1 March 2024 must apply for Corporate Tax registration based on the month their license was issued:

Resident Persons Started on or after March 1, 2024

• Resident persons incorporated, established, or otherwise recognized in the UAE on or after March 1, 2024, must register for corporate tax within three months of the date of their incorporation, establishment, or recognition.
• Resident persons incorporated, established, or otherwise recognized in another country must register within three months of the end of their financial year if they are effectively managed and controlled in the UAE.

Non-Resident Persons:

• Non-resident persons with permanent establishments in the UAE before March 1, 2024, must register for corporate tax within nine months of their establishment.
• Non-resident persons with permanent establishments established in the UAE on or after March 1, 2024, must register within six months of their establishment.
• Non-resident persons with a nexus in the UAE must register by May 31, 2024, if the nexus existed before March 1, 2024. If the nexus was established on or after March 1, 2024, registration is required within three months.

For Natural Persons:

• Resident Persons: If the turnover exceeds the specified threshold during the Georgian calendar year 2024, they must register for corporate tax by March 31 of the following year.
• Non-Resident Persons: If the turnover exceeds the specified threshold during the Georgian calendar year 2024 or subsequent years, they must register for corporate tax within three months of meeting the criteria to be considered a taxable person.

Procedures and Steps for Corporate Tax Registration

To commence the Corporate Tax Registration process, an account must be created on the Emaratax portal, requiring new users' email ID and phone number.

• Existing users may proceed by logging in with their established ID and password.
• Upon accessing the portal, one must either create a profile for a taxable person or select an appropriate entity from the list of taxable persons.
• The Emaratax portal provides an option for Corporate Tax registration. This option must be selected to initiate and complete the registration process.
• Recognizing the complexities involved in Corporate Tax registration, Filings.ae offers comprehensive support throughout this process.

Corporate Tax Filing

After obtaining Corporate Tax Registration, businesses must proceed with Corporate Tax Return Filing to comply with UAE tax regulations. Filings.ae offers expert assistance in this crucial step to ensure accuracy and compliance.

Simplify the Corporate Tax Registration process with Filings.ae.

At Filings.ae, our team offers expert guidance and streamlined solutions for creating your taxable entity on the Emaratax portal and ensuring accurate and compliant registration. With Filings.ae, businesses gain the advantage of efficiently handling all aspects of Corporate Tax Registration & Corporate Tax Filing. Our commitment is to provide a hassle-free experience, allowing companies to focus on their core operations.

For a seamless experience managing the complexities of Corporate tax registration and tax filing, contact Filings.ae to ensure accuracy and adherence to regulations.