CTP001 – Corporate Tax Registration Timelines

The recent clarification published by the Federal Tax Authority addresses Federal Tax Authority Decision No. 3 of 2024, which outlines the timelines for taxable persons to register for Corporate Tax in the UAE.

The public clarification has been released to resolve a lot of doubts and queries that has been had by a lot of the companies in the UAE, regarding the status of their registration requirements and along with will be timeline for them.

Summary

The Federal Tax Authority has already mentioned that every person is required to register for Corporate Tax by way of an application that has be submitted on the Emara-Tax Portal within the prescribed timeline that has been set out by the Federal Tax Authority.

Any Taxable Person that does not submit the application for registration within the stipulated timeline will be levied a penalty of AED 10,000 for the late registration of Corporate Tax.

The timelines mentioned by the Federal Tax Authority differ based on the type of taxable person as mentioned below,

A Juridical Person that is a Resident Person
A Juridical Person that is a Non-Resident Person
A Natural Person

Registration Timeline for Juridical Person That Is A Resident Person

A juridical person that is a Resident Person must submit a Corporate Tax registration application, considering the date of its incorporation, establishment, or recognition under applicable UAE legislation. This requirement extends to Free Zone Persons and Offshore Companies incorporated, established, or otherwise recognized under UAE law.

Incorporation Prior To 1-Mar-2024

For juridical persons incorporated, established, or recognized prior to 1 March 2024, a Corporate Tax registration application must be submitted to the FTA based on the month of their license issuance, as outlined in the table below,

Date of License Issuance	Deadline for Submitting Application
1 Jan – 28/29 Feb	31 May 2024
1 Mar – 30 Apr	30 Jun 2024
1 May – 30 May	31 Jul 2024
1 Jun – 30 Jun	31 Aug 2024
1 Jul – 31 Jul	30 Sep 2024
1 Aug – 30 Sep	31 Oct 2024
1 Oct – 30 Nov	30 Nov 2024
1 Dec – 31 Dec	31 Dec 2024

In the case of an “Offshore Company,” characterized by its legal incorporation status but lacking a valid license, it holds a certificate of incorporation in the UAE. Therefore, the Offshore Company is mandated to register according to the timeline stipulated above, based on the month of issuance as indicated in the Certificate of Incorporation rather than the license.

If a juridical person does not hold a license as of 1 March 2024, the deadline for submitting the Tax Registration application is 31 May 2024, three months from the effective date of FTA Decision No. 3 of 2024.
If a juridical person holds an expired license as of 1 March 2024 that has not been canceled, it must submit a Tax Registration application based on the month of its original license issuance.
If a juridical person holds multiple licenses as of 1 March 2024, it should use the month of issuance of the earliest license to determine the Corporate Tax registration deadline.

Incorporation After 1-Mar-2024

A juridical person incorporated, established, or recognized in the UAE on or after 1 March 2024 must submit a Tax Registration application within three months of its incorporation, establishment, or recognition date.
A juridical person incorporated or recognized under foreign legislation but managed and controlled in the UAE must submit a Tax Registration application within three months of its financial year-end.

Registration Timeline for Juridical Person That Is A Non-resident Person

A juridical person that is a Non-Resident Person must submit a Corporate Tax registration application to the FTA based on the date it became a Non-Resident Person

Being Non-resident Prior To 1-Mar-2024

If a juridical person is a Non-Resident Person before 1 March 2024, it must submit a Corporate Tax registration application to the FTA based on whether it has a Permanent Establishment or nexus in the UAE.

In case if the juridical person has a Permanent Establishment in the UAE, the application must be submitted within nine months from the date the Permanent Establishment is recognized for UAE Corporate Tax purposes, i.e., 6 months of operation in the UAE.
If an international agreement for the avoidance of double taxation allows a longer duration to recognize a Permanent Establishment in the UAE than stipulated in the Corporate Tax Law, the provision in the international agreement shall take precedence.
If the juridical person has a nexus in the UAE before 1 March 2024, it must submit a Tax Registration application within three months from the effective date of FTA Decision No. 3 of 2024, specifically by 31 May 2024.

Being Non-resident After 1-Mar-2024

If a juridical person becomes a Non-Resident Person on or after 1 March 2024, it must submit a Corporate Tax registration application to the FTA depending on whether it has a Permanent Establishment or nexus in the UAE.

If the juridical person has a Permanent Establishment in the UAE, it must submit a Tax Registration application within six months from the date on which the Permanent Establishment has come into existence.
If an international agreement for the avoidance of double taxation stipulates a longer duration for recognizing a Permanent Establishment in the UAE compared to the Corporate Tax Law, the provision within the international agreement shall take precedence.
If the juridical person has a nexus in the UAE, it must submit a Tax Registration application within three months of establishing that nexus.
If a Non-Resident Person has both a Permanent Establishment and a nexus in the UAE, they must meet the earliest of the two deadlines for submitting their Tax Registration application to the FTA for Corporate Tax.

* Please note that for establishing a nexus in the UAE, the relevant date is when the taxable person starts generating income, not the date of having connection with immovable property.

Registration Timelines for Natural Persons

1. If They Are Resident Person

A resident natural person must register for Corporate Tax with the Federal Tax Authority (FTA) if their business turnover in the UAE exceeds AED 1 million in a Gregorian calendar year, starting January 1, 2024. If this threshold is exceeded, they must register by March 31 of the following year. Income generated before January 1, 2024, is not subject to Corporate Tax.

2. If They Are Non-resident Person

A non-resident natural person must register for Corporate Tax with the Federal Tax Authority (FTA) if their turnover from a Permanent Establishment in the UAE exceeds AED 1 million in a Gregorian calendar year, starting January 1, 2024. If this threshold is exceeded, they must register within three months. Turnover generated before January 1, 2024, is not subject to Corporate Tax.

How BAM Can Assist Your Company

BAM offers comprehensive assistance to businesses in understanding their corporate tax obligations and the implications these obligations have on their business operations.
BAM provides expert guidance on the specific requirements for corporate tax registration, implementation, advisory services, transfer pricing services etc.
BAM supports clients in preparing all necessary documentation, including detailed reports, tax computations, and supporting schedules, to ensure full compliance with prevailing tax laws and regulations.

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