Federal Decree-Law No. 47 of 2022, the Corporate Tax Law, was implemented in the United Arab Emirates on January 31st, 2022. This legislation, which comes into effect on June 1st, 2023, introduces a Federal Corporate Tax regime with the objective of enhancing the UAE's strategic goals and strengthening its standing as a major international economic hub. In order to increase its attractiveness to businesses and investors, the UAE seeks to promote clarity and openness in its corporate tax structure by implementing acknowledged principles and adhering to international accepted standards.
Failure to File Tax Returns on Time
A penalty of AED 500 per month applies if tax returns are not submitted by the due date within the first 12 months, increasing to AED 1,000 per month afterward.
Registration for corporate tax
According to Article 51 of the Federal Decree Law No. 47 of 2022 (UAE CT Law), a Taxable Person must register for CT with the FTA and get a Tax Registration Number within the time frame specified by the FTA.
''Late submission of corporate tax registration application''
Taxable Persons that fail to submit the application for UAE Corporate Tax Law within the timelines stipulated by the FTA may face a penalty of AED 10,000.
Tax departments which are based in-house in companies are often challenged to meet constantly changing requirements. Our experienced professionals will ensure a smooth and seamless transition to the new era of CT regime within the UAE. This way your team’s burden is lessened. Our corporate tax teams are already working on tax impact assessments, transfer pricing reviews, cross-border transaction reviews and planning operational implementation for several businesses in the UAE.
The aforesaid phases in the diagram be changed to as under:
- Phase I: Impact Assessment
- Phase II: Transition Support
- Phase III: Compliance Support
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