Corporate Tax Obligations of UAE Companies
In March 2024, Decision No. 3 of the UAE Federal Tax Authority came into force, which is of fundamental importance for Emirati companies: it sets new registration deadlines for corporate income tax purposes.
Now for all legal entities registered before March 1, 2024, the period of tax registration depends on the month of the license issue.
Note! If there are several licenses, the date of the earliest license should be used.
Corporate Tax Registration Services from AED 1 300
It is important to note that other deadlines are set for certain categories of persons, namely:
- for UAE resident legal entities incorporated after March 1, 2024: if the company is incorporated in the UAE, 3 months from the date of incorporation; if in a foreign jurisdiction, 3 months following the end of the financial year;
- for non-resident legal entities that have a permanent establishment or “nexus” in the UAE (see Article 4 of Decision No. 3);
- for UAE resident individuals carrying out business activities, until March 31 of the following calendar year; if the turnover threshold of AED 1 million during 2024 is exceeded, then until March 31, 2025;
- for non-resident UAE individuals carrying out entrepreneurial activity – not later than 3 months from the date when the person is subject to income tax if the turnover threshold of AED 1 million is exceeded.
The penalty for late registration for corporate income tax purposes is AED 10,000 (USD 2,725).
Tax Incentives for Free Zone Companies in the UAE
At the end of 2023, the UAE published the outcome of a public consultation on the zero rate of taxation for qualified Free Zone residents. Decisions No.55 and No.139 previously published by the Ministry of Finance have been cancelled and new decisions No.100 and No.265 have been issued. The application of tax benefits has been expanded and many points have been more fully explained.
