Preparation and filing of corporate tax returns in the United Arab Emirates (UAE) is carried out in accordance with the Federal Law-Decree No. 47 of 2022. It outlines the procedures for maintaining accounting records, preparing financial statements, storing documentation, and the deadlines for submitting information to the UAE Federal Tax Authority (FTA).
General requirements for companies on corporate tax
According to the Law, all companies registered both in free economic zones (FEZ) and outside them in each of the Emirates (Abu Dhabi, Dubai, Sharjah, Ras Al Khaimah, Ajman, Fujairah, Umm Al Quwain) are required to maintain financial statements not only for their internal accounting, but also for calculating taxable income. Additionally, businesses must retain all supporting documents and records for tax returns filed or other reports submitted to the FTA.
Even tax residents who are exempt from corporate tax must retain documentation to support this status. All records must be retained for at least seven (7) years from the end of the relevant tax period.
Alliance Business Advisors provides services for the preparation and filing of corporate tax returns, as well as advice on tax refunds and returns.
Corporate Tax Return Filing Procedure in the UAE
The filing of the return and payment of corporate tax must be made within nine (9) months of the end of the tax period.
Returns are submitted via the Emaratax electronic platform, designed to streamline interactions with the UAE tax authorities. Personal presence is not required for registration, filing returns, or other transactions, and there is no need to submit original documents.
So, to file a corporate tax return in the UAE, a company will need to:
- Register with the UAE tax authority and obtain a tax registration number.
- Keep accurate records of all financial transactions and supporting documentation in accordance with UAE tax laws.
- Calculate taxable income using accounting data and adjust it for tax deductions and benefits provided by law.
- File a profit tax return to the relevant UAE tax authority.
- Pay the profit tax within the prescribed time frame.
- Provide the necessary documentation in case of an additional audit by the UAE Federal Tax Authority.
While an audit of financial statements is not mandatory for companies subject to corporate tax in the UAE, there are still several compelling reasons to have one:
- An audit will be required if a tax audit is initiated.
- Free economic zones often require the submission of audit reports.
- The financial statements serve as the basis for the return, and the audit helps verify the accuracy of the data and supports dealings with third parties.
If you have any difficulties with this issue, do not attempt to resolve it on your own, or if you cannot hire a separate specialist, entrust it to the professionals at Alliance Business Advisors.
Our specialists regularly update the website and monitor the UAE Ministry of Finance's news to provide up-to-date data and explanations on declaration completion.
Calculation of taxable income
The taxable base is determined based on the net accounting profit calculated in accordance with International Financial Reporting Standards (IFRS). In this case, the calculation takes into account adjustments for the following items:
- Unrealized gains or losses;
- Non-taxable income (for example, dividends and capital gains);
- Intragroup transactions;
- Non-deductible expenses;
- Transactions with affiliates;
- Benefits and incentives provided by law.
Some types of income in the UAE are exempt from tax, including dividends and capital gains received from owning shares. However, corporate tax applies to income received from entrepreneurial activity.
For more detailed advice on this issue, complete a short form on our website, describe your request, and our managers will promptly contact you with professional advice.
Alliance Business Advisors' services
We offer comprehensive services to help you comply with UAE tax legislation, including:
- Control over the deadlines for filing tax returns with the Federal Tax Service.
- Preparation and verification of financial documentation.
- Optimization of the tax burden and analysis of tax risks.
- Correct calculation of taxable profit or loss.
- Prompt interaction with the relevant tax authority.
- Assistance in paying taxes and complying with all legal requirements.
- Ongoing support and feedback.
Corporate tax legislation applies to all Emirates, and interactions with the tax authority are conducted through the portal created by the UAE Ministry of Finance.
We are ready to support your business at every stage of your interactions with the UAE tax authorities!
Frequently asked questions
Do companies in free economic zones need to file a tax return?
Yes, all companies in the UAE, both in free zones and outside them, must register, obtain a tax number, and file returns regularly.
Do I need to file a return even if there is no profit?
Yes, companies are required to file returns even if they have no income to record tax losses for subsequent accounting. If a company is registered with the tax authority, it must file a return before it is officially deregistered.
Can I file one return for a group of companies?
Yes, if the companies meet the tax group's requirements and have received the appropriate approval. In other cases, each company files its own return.
Do I need to account for foreign taxes when filing a return?
Yes, the UAE has signed bilateral agreements on the avoidance of double taxation, and some foreign entrepreneurs fall within their scope. Our specialists will advise you in detail on this issue.
How to determine the tax period for your company?
For companies whose financial year differs from the calendar year and is specified in their statutory documents, the tax period is determined based on that financial year. The declaration must be filed within 9 months after the end of the reporting period. For example, if the financial year ends on December 31, 2024, the declaration must be filed before the end of September 2025.
