UAE Corporate Tax – A Comprehensive Overview of the New Development of Corporate Tax Registrations for Taxable Persons in UAE

UAE Corporate Tax – A Comprehensive Overview of the New Development of Corporate Tax Registrations for Taxable Persons in UAE

Introduction

The Federal Tax Authority (FTA) recently announced Corporate Tax Registration deadline for all Taxable Persons wide FTA Decision No. 3 of 2024. Under the issued decision on deadlines, all Taxable Persons must register with the Federal Tax Authority (FTA) for Corporate Tax within the applicable deadlines to avoid levy of any penalties. Let us have a close look at the deadlines and penalties.

The Decision states about the timelines for submitting of an application for all the type of taxable persons:

  • Resident Juridical
  • Non-Resident Juridical
  • Natural Persons

Below is the complete list of Timeline for the Tax Registration of  Resident juridical Persons:

  1. Timelines for Resident Juridical Persons existing before March 1st, 2024.
corporate tax registration deadline uae


Note: Where a juridical person has more than one License, the license with the earliest issuance date shall be used.

Timelines for Resident Juridical Persons Incorporated/ Recognized/ Established on or after March 1st, 2024.

  • Under the applicable legislation in the State, including a Free Zone Person: (3) three months from the date of incorporation establishment recognition.
  • Under the applicable legislation of a foreign jurisdiction that is effectively managed and controlled in the State: (3) three months from the end of the financial year of the person.

Timeline for the Tax Registration of  Non-Resident Juridical Persons

Non- Resident Juridical Person effective before March 1, 2024

  • A person having a permanent establishment in UAE: 9 months from the date of Permanent Establishment  existence in UAE.
  • A person having nexus in UAE: May 31,2024 (3 months from Effective date pf the decision, i.e. March 01,2024) 0

Non-Resident Juridical Person effective on or after 01 March 2024

  • A person having Permanent Establishment in UAE:  6 months from the date of existence of Permanent Establishment in UAE.
  • A person having nexus in UAE: 3 months from the date of establishment of nexus.

Overview of the Timeline for the Tax Registration of Natural Person

  • A Resident Person conducting business activities in 2024 or subsequent years, with a total turnover exceeding AED 1 Million in a Gregorian Calendar year: March 31st, of the subsequent Gregorian Calendar Year.

  • A Non-Resident Individual engaging in business activities during the 2024 Gregorian calendar year or subsequent years, with total turnover surpassing the threshold of AED 1 Million in a Gregorian Calendar year: 3 Months from date of meeting the requirements of being subject to tax.

What is the Administrative Penalty for Non-Compliance of Tax Registration within the Timeline?

A Taxable Person failing to comply with obtaining  corporate tax registration application within the deadline  issued by the authority in their recent Decision will attract penalty of AED 10,000 (Ref: CD 75 of 2023)

Seeking Assistance from Tax and Finance Professionals

With this new corporate tax law coming into effect, FTA has advised companies to seek assistance from professional tax and finance companies to understand the rules better. It has also underlined the importance of tax compliance and asked firms to maintain proper records and file tax returns on time to avoid fines and penalties. You should connect with professional financial services and seek the right advice to ensure you don’t face any penalty or tax-related issues.

NRD Compliance service covers all aspects of UAE Corporate Tax and Transfer Pricing. This includes- UAE CT and TP Advisory, UAE CT and TP Impact Assessment, CT Return Filing, CT De-registration, and others. Besides these, NRD also deals with VAT Consultancy Services, ESR Consultancy Services, CRS and FATCA Filing.

FAQs

1) What is the deadline for Taxable Persons to apply to FTA for Corporate Tax Registration?

Taxable Persons must submit their applications by a deadline in accordance with the decision issued by the Authority varying from month to month based on the issue date of the license.

2) What if the company misses the deadline to apply?

The FTA has ruled about the penalty of AED 10,000 according to Cabinet Decision No. 75 of 2023 for non-compliance with the registration.

If you are looking for an authentic firm to deal with your corporate tax matters? Look no further than us. Please contact our corporate tax expert on +971 50 6591233 or enquiries@nrdoshi.ae

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