Corporate tax return filing is a legal requirement for companies operating in the UAE, and failure to file tax returns can result in penalties and fines. UAE corporate tax law is announced and companies are preparing to file corporate tax returns within the given time by the Federal Tax Authority (FTA).
Corporate Tax was first introduced in January 2022 by the Ministry of Finance, UAE, thus declaring the implementation in June 2023 or by January 2024. The Corporate Tax Law will go into effect on June 1, 2023, with a headline rate of 9%. Any annual taxable profits under AED 375,000 are subject to a 0% rate. The regime incorporates elements that are best practices in international taxes.
Every Taxable Person must register for Corporate Tax and obtain a Tax Registration Number. In some cases, the tax authority requests the Exempt Persons also to register for Corporate Tax.
This session discusses Corporate Tax Filing In UAE
Corporate tax return filing in the United Arab Emirates (UAE) is the process of submitting a report to the relevant tax authority that details the income and expenses of a company. The Corporate Tax Return is filed by the Taxable Person for a specific tax period on the information about Corporate tax liability and payment. The Tax Return should be filed within a specific period with the tax authority according to the Corporate Tax Law.
In case any additional information, a document, or a record is requested by the Authority, it should be submitted by the taxpayer to the tax authority.
Is it Mandatory To File Corporate Tax Returns in UAE?
Yes, it is mandatory to file Corporate Tax returns in the United Arab Emirates (UAE). The Federal Tax Authority (FTA) requires companies operating in the UAE to file tax returns and pay taxes on their taxable income as per the UAE tax laws. However, only 0% tax will be subjected for businesses with income less than AED 375,000.
The tax laws in the UAE apply to both local and foreign companies operating in the country, and failure to file tax returns or pay taxes can result in penalties and fines.
Should UAE businesses with no income file for CT returns? All Taxpayers are required to file a Corporate Tax return, irrespective of the income level or the status of the company.
Should Free Zone entities file for Corporate Tax Returns?
Corporate Tax in UAE is imposed on Free Zone Persons as well. Hence, All Free Zone entities will be required to file a Corporate Tax return, even if they are Qualifying Free Zone persons or not.
How often Businesses should file for Corporate Tax Returns in UAE?
UAE Businesses will be required to file for corporate tax returns only once per the tax period. The CT return is apparently due nine months after the Tax Period has ended. Also, No advance or preliminary corporate tax filings are necessary.
Businesses in the UAE will have up to 9 months from the end of the relevant tax period to submit their tax return and pay the Corporate Tax to the Federal Tax Authority (FTA). For example, a company with a first tax period beginning on June 1, 2023 will have a deadline up to February 28, 2025, whereas a company with a first tax period beginning on January 1, 2024 would have a deadline up to September 30, 2025.
This move is based on the UAE’s dedication to ensuring the smooth implementation of Corporate Tax policy. Benefits of filing corporate tax returns include efficient cost and proper control of time, a single tax return for a group, and the ability to combine the amount of group tax paid, wherein certain companies make a taxable profit while others may have a tax loss.
How to File Corporate Tax Returns in UAE?
You can file Corporate Tax Returns online through the EmaraTax portal. Currently, the FTA approves the pre-registration of corporate tax for selected entities. If you are one, you can register for corporate tax in EmaraTax. Have not created an account on EmaraTax? Here’s a guide to log in and register into EmaraTax. EmaraTax merged with the UAE Central Bank and UAE PASS to reorganize the user experience.
Procedure of Corporate Tax Return Filing in UAE
The procedure of filing corporate tax returns in UAE includes,
- Tax registration: Obtain a tax registration number from the Federal Tax Authority (FTA) by submitting the required documents and information.
- Record keeping: Maintain proper records of all financial transactions and tax-related documents in accordance with the UAE tax laws.
- Preparation of tax return: Calculate taxable income and prepare a tax return based on the records maintained, taking into account tax deductions and exemptions as per the UAE tax laws.
- Filing of tax return: Submit the tax return to the FTA through their online platform, e-Services, on or before the due date.
- Payment of tax: Pay the tax liability as per the tax return filed on or before the due date.
- Tax audit: In case of a tax audit, the FTA may request additional information or documents to verify the accuracy of the tax return filed.
We can help you in calculating and devising your tax liability for Corporate tax and assist you throughout the UAE Corporate tax return filing process.
Elements of Corporate Tax Return Filing Services
When you file Corporate Tax Return, it must include information about the profits and expenses of the company. The final result evaluates the tax amount liable to be paid to the government.
These are the basic documents you require when filing Corporate Tax Returns:
- Financial records
- Taxable income calculations showing changes in the net result in accounting
- Records and Plans for devaluation of tax
- Transfer Pricing records
- Information on transactions that involve relatives
- Movement of Provisions
The tax experts and professionals at BMS Auditing ensure the accurate preparation of corporate tax returns, protecting them from the risk of audit, thus ensuring maximum tax claims.
BMS Auditing has highly knowledgeable and experienced Tax consultants in UAE in assisting clients with the best Corporate Tax services in UAE for Corporate Tax returns, ensuring staying compliant with the laws and regulations of the Tax Authority.
Our team also guides you through document preparation, calculating the tax liability, and tax compliance for Corporate Tax activities such as Registration, filing returns, refunds, etc.
Need Help with filing Corporate Returns? Call BMS Auditing Dubai for queries.