Corporate Tax is a form of direct tax levied on the net income of corporations and other businesses. Corporate Tax is sometimes also referred to as “Corporate Income Tax” or “Business Profits Tax” in other jurisdictions. Corporate tax registration refers to the process by which a business entity formally registers with the appropriate tax authority to fulfill its obligations related to corporate taxation. The purpose of corporate tax registration is to ensure compliance with tax laws and regulations, enabling the business to fulfill its tax obligations, file tax returns, and pay taxes on its profits or income. Corporate Tax is a form of direct tax levied on the net income of corporations and other businesses.
Corporate tax in the UAE shall be imposed on the taxable income of businesses at the following rates :
Broadly, Corporate Tax applies to the following “Taxable Persons”:
Profits Exceed AED 375,000: Any business with profits over this threshold must register and file tax returns.
Foreign Companies with a UAE Presence: Foreign businesses with a branch or permanent establishment in the UAE are required to register.
Oil, Gas, and Petrochemical Companies: These companies are taxed regardless of their profits.
Financial Institutions: Banks, insurance companies, and other financial entities must register.
Free Zone Entities: Free zone businesses may need to register unless they meet certain conditions for exemption.
Exemptions: Some sectors like healthcare and education may be exempt from Corporate Tax.
To register for Corporate Tax in UAE, businesses must be ready to submit the required documents. The process for corporate tax registration will be done online. The following documents required for Corporate Tax Registration 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
