How to file corporate tax returns in UAE?

UAE businesses must file corporate tax returns to ensure legal compliance and avoid penalties. The corporate tax rate structure in UAE is a 0% corporate tax rate for companies with annual taxable profits below AED 375,000 and a 9% rate for those exceeding that threshold. The filing process is streamlined, allowing businesses to submit financial statements, calculate taxable income, and pay any due tax electronically through the EmaraTax portal. This article delves deeper into corporate tax returns in the UAE and guides you through the online filing process.

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What is Corporate tax return filing in UAE?

Corporate tax return filing in the United Arab Emirates (UAE) involves submitting a detailed report to the Federal Tax Authority (FTA) that outlines the company's income and expenses for the tax year. This report is the foundation for calculating the company's taxable income and determining its corporate tax liability. According to corporate tax law, the tax return must be filed within a specific period.

Documents required for UAE corporate tax return filing

When you file corporate tax returns, you must include information about your profits and expenses. This automatically calculates the liable amount to be paid to the government. Keep the following documents, which are required for filing corporate tax returns.

• Financial records: Serve as proof of income and expenses for tax calculations.
• Taxable income calculations: Explain adjustments to accounting income to arrive at taxable income.
• Records and Plans for devaluation of tax (depreciation): Detail the depreciation expense claimed for tax purposes.
• Transfer Pricing records: Justify the pricing of transactions with affiliated companies.
• Information on transactions that involve relatives: Disclose all business dealings with related parties.
• Movement of Provisions: Track the funds set aside for anticipated future expenses.

Steps to file Corporate tax returns in UAE

Find the procedure to file corporate tax returns in UAE through the EmaraTax below.

1. Tax Registration (if not already done):

• Obtain a Tax Registration Number (TRN) from the Federal Tax Authority (FTA). You can do this through the EmaraTax portal. This step might be pre-filled if you're already registered for VAT.
• Gather the required documents as per the FTA guidelines. These typically include trade licenses, ID proofs, and authorisation documents (if applicable).

2. Record Keeping:

• Maintain meticulous records of all your company's financial transactions throughout the tax period.
• Ensure you keep all tax-related documents like invoices, receipts, and bank statements readily available. These documents should comply with UAE tax regulations.

3. Preparation of Tax Return:

• Calculate your taxable income with your company's income from all sources, deducting allowable expenses and factoring in any tax exemptions you qualify for under UAE tax laws.
• Utilize the records you maintained to prepare the tax return form accurately.

4. Filing of Tax Return:

• Access the FTA's EmaraTax Portal.
• Submit the completed tax return electronically through the EmaraTax portal.
• Ensure you file the return on or before the due date, typically nine months from the end of your tax period.

5. Payment of Tax:

• Based on the submitted tax return, calculate your tax liability.
• Make the tax payment before the due date using the methods specified by the FTA.

6. Tax Audit:

• Sometimes, the FTA may choose your company for a tax audit.
• During an audit, the FTA might request additional information or documents to verify the accuracy of your filed tax return.

Note: In the case of a tax group, a parent company can file the corporate tax returns on behalf of the tax group. Tax group members do not need to file separate corporate tax returns

What is the deadline for filing corporate tax returns in UAE?

Previously, the deadline for filing corporate tax returns in the UAE is typically nine months from the end of your company's tax period. For example, if your company's financial year ends on December 31st, 2024, the deadline to file your corporate tax return for that year would be September 30th, 2025. This decision ensures the smooth implementation of corporate tax policy in the UAE.

Know about the current deadline (2024): Corporate tax registration: 2024 new deadlines and penalty

How Frequently does the Business file corporate tax returns?

In the UAE, businesses file corporate tax returns annually, with the CT return due nine months after the tax period ends. No advance or preliminary filings are required. This simplifies the filing process compared to jurisdictions that require quarterly or more frequent filings.

Is corporate tax return filings applicable to freezone companies?

Yes, all the freezone companies must file for corporate tax returns, regardless of whether they are "Qualifying Freezone Persons" or not. The same procedure and deadlines are applicable for freezone companies as well.

To get detailed information: Corporate tax applicable for freezone companies

Conclusion

All businesses must file corporate tax returns in the UAE for legal compliance. This annual process involves submitting financial statements, calculating taxable income based on profits exceeding AED 375,000, and paying any due tax through the EmaraTax portal. Failure to file by the nine-month deadline after the tax period ends can result in penalties. Get expert help to file your corporate tax returns from Filings.ae.

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