UAE Corporate Tax: Registration, Filing & Planning with Confidence

All UAE juridical persons must register for CT regardless of income level. Registration must be completed on EmaraTax within 3 months of the start of the first financial year to which CT applies. For companies with a 1 January 2024 FY start, the deadline was 31 March 2024. Penalties for late registration are AED 10,000 per violation. GULF CONSULT manages CT registration end-to-end for all client entity types.

Free zone companies are subject to CT, but Qualifying Free Zone Persons (QFZPs) benefit from a 0% CT rate on their Qualifying Income. To qualify: the entity must maintain adequate substance in the free zone; derive at least 95% of income from qualifying sources; not have elected to be in the standard CT regime; file audited accounts; and not have mainland UAE income exceeding the de minimis threshold (5% of revenue or AED 5 million, whichever is lower). Non-qualifying income remains taxable at 9%. GULF CONSULT conducts QFZP assessments and advises on income structuring to maintain qualifying status.

Key non-deductible expenses include: bribes and illicit payments (fully disallowed); fines and penalties (disallowed); donations to non-qualifying entities (disallowed); interest expenditure (subject to a 30% EBITDA cap, banks and insurance companies exempt); entertainment and hospitality (50% deductible); and transactions with connected persons not at arm's length (adjusted). GULF CONSULT prepares a full addback schedule as part of every CT return preparation engagement.

The CT return must be filed and any liability paid within 9 months of the end of the relevant tax period. Failure to file results in a penalty of AED 500 per month for the first 12 months and AED 1,000 per month thereafter. Additional penalties apply for underpayment (minimum 14% per annum on underpaid amounts), incorrect returns and failure to maintain adequate accounting records.

Yes: if your revenue is AED 3 million or less in a tax period, and was AED 3 million or less in all prior tax periods ending on or before 31 December 2026, you may elect for Small Business Relief on your CT return. This treats your taxable income as nil for that period, effectively eliminating CT liability. However, you must still register for CT, file a return and elect the relief. The election is made on the CT return itself. GULF CONSULT advises on SBR eligibility and handles the election filing.

Corporate Tax and VAT are separate taxes administered by the FTA. VAT is charged on taxable supplies and is not income for CT purposes: input VAT recovered is not taxable income, and output VAT collected is not revenue. However, irrecoverable input VAT (i.e. VAT on exempt or blocked items) is a business expense and may be deductible for CT purposes. CT is based on the net profit of the business, not on turnover. Maintaining clear accounting records that separate VAT from operational revenues and expenses is critical for accurate CT compliance.

All transactions between related parties and connected persons must be conducted at arm's-length prices under Article 34 of the UAE CT Law. Businesses with related-party transactions exceeding certain thresholds must complete a Transfer Pricing Disclosure Form (Schedule 2 to the CT return) and prepare a Master File and Local File if applicable. The FTA can adjust transactions not at arm's length to their arm's-length equivalent, potentially increasing taxable income significantly. GULF CONSULT provides transfer pricing documentation and disclosure services for businesses with intercompany transactions.

Yes: UAE CT applies to both juridical persons (companies) and natural persons conducting business in the UAE, where their business or business activity generates revenue above AED 1 million in a calendar year (from 1 January 2024). This includes sole proprietorships, sole establishments and individual business owners, not just companies. Freelancers and self-employed individuals with business income above AED 1 million are subject to CT. The 9% rate and AED 375,000 taxable income threshold apply in the same way as for corporate entities.