For a long time, the UAE was one of the few authorities in the world to impose 0% tax against most corporate and personal revenue. But, to help the nation uphold its top-tier corporate environment, the UAE have presented some changes to this policy. Businesses now have a new registration plan that substitutes the prior deadline of September 2025. The new schedule has amazed deadlines during 2024. As per the UAE latest decree law, no. 3 and 10 of 2024, that is issued by the UAE Ministry of Finance, obligates registration for companies. If companies fail to obey with these rules within the specified timeframe, they will face a fine of AED 10,000.
What are the Deadlines for Initial Corporate Tax Registration?
Initial corporate tax registration deadlines are actually based on the license issuance date such as;
- If the licenses Issued Between January and February, the deadline for registration is May 31, 2024.
- If the Licenses Issued After March 1, 2024, the deadline is three months from the date of issuance.
- If you are Foreign Entities with Permanent Establishments so the Specific deadlines may apply based on individual circumstances.
| Month of license issuance | Registration deadline |
| January or February | May, 31, 2024 |
| March or April | June, 30, 2024 |
| May | July, 31, 2024 |
| June | August, 31, 2024 |
| July | September, 30, 2024 |
| August or September | October, 31, 2024 |
| October or November | November, 30, 2024 |
| December | December, 31, 2024 |
It is important to note that companies that miss the above deadlines for initial corporate registration, it will result in facing a penalty of AED 10,000.
What are the Annual Filing Deadlines for Corporate Tax Registration?
The deadline for filing a corporate tax return in the UAE is depend on your business’s end of financial year. You have 9 months after the end of your business’s financial year to file your tax returns.
For example, if your financial year ends on December 31, 2023, you have to submit your tax return by September 30, 2024. On the other hand, if your financial year settles on June 30, 2024, you will have to submit your tax return by March 31, 2025.
What Are the Corporate Tax Rules for Free Zone Entities?
The Corporate Tax Rules for Free Zone Entities are;
- Income generated from activities led within the free zone is usually measured as qualifying income. It is exempted from UAE corporate tax.
- Income produced outside the free zone or from activities not measured as qualifying is subject to the standard UAE corporate tax rate of 9%.
- If a free zone entity founds a permanent establishment outside the free zone such as an office, branch, income produced through this permanent establishment may be subject to the UAE corporate tax.
What are the Eligibility criteria for the 0% corporate tax rate in free zones?
To qualify 0% corporate tax rate in free zones, the Eligibility criteria that must be meet are;
- The company have to be legally established and listed within a designated free zone in the UAE.
- The company’s prime revenue must be derived from activities led within the free zone and measured as qualifying economic activities. These activities typically comprise services, and industrial processes.
- The company have to validate significant economic activity within the free zone. This comprises having suitable physical presence, workers, and operative activities.
- The company’s non-qualifying income such as income produced outside the free zone or from non-qualifying activities should not surpass certain thresholds.
Conclusion
The corporate tax laws in the UAE obligates that all companies working or merged in the country have to register for corporate tax. Businesses must keep appropriate accounting records, financial statements, and file for tax annually, even if they be suitable for an exemption, produce no revenue, or are listed within a free zone. So, even if a business is not compulsory to pay corporate tax in the UAE, it still has to comply with the essential steps to demonstrate its non-taxable status. It is recommended to get guidance from top consultants in the UAE such as Corporate Tax UAE Their proficient team has capability to handle all complications and make path smoother to comply the deadlines of corporate tax registration.