Corporate Tax Registration: FTA’s decision with clear deadlines and a penalty of AED 10,000.
Introduction
In a recent update from the UAE Ministry of Finance, businesses now have a deadline for corporate tax registration filings. The latest directive, effective March 1, 2024, outlines specific deadlines set by the Federal Tax Authority (FTA) for submitting corporate tax registration applications. This structured approach, introduced through Federal Tax Authority Decision No. (3) of 2024 and Cabinet Resolution No. (10) of 2024, establishes clear timeframes tailored to different taxable entities and individuals. Compliance with these deadlines for corporate tax registration is crucial for businesses to avoid violations of tax laws in the UAE, leading to penalties.
Effective Date and Registration Deadlines
As of March 1, 2024, the decisions are in full force, mandating all eligible entities to obtain a Tax Registration Number (TRN) promptly. The deadline for corporate tax registration is outlined, with key dates varying based on factors such as license issuance date, date of incorporation, surpassing threshold, and the existence of a Permanent Establishment (PE) or nexus.
Resident Juridical Persons
For resident juridical persons existing before the effective date, the timeline for corporate tax registration in UAE is intricately tied to the date of license issuance, spanning from May 31, 2024, to December 31, 2024, with a detailed table providing specific date ranges. Entities without a license at the effective date must promptly submit their tax registration application within three months of the decision’s effective date. Moreover, for entities holding multiple licenses, the deadline for corporate tax registration is determined by the license with the earliest issuance date.
| Date of license issuance, irrespective of year of issuance | Deadline for submitting a Tax Registration application |
| 1 January —31 January | 31 May 2024 |
| 1 February — 28/29 February | 31 May 2024 |
| 1 March —31 March | 30 June 2024 |
| 1 April —30 April | 30 June 2024 |
| 1 May – 31 May | 31 July 2024 |
| 1 June – 30 June | 31 August 2024 |
| 1 July – 31 July | 30 September 2024 |
| 1 August – 31 August | 31 October 2024 |
| 1 September – 30 September | 31 October 2024 |
| 1 October – 31 October | 30 November 2024 |
| 1 November – 30 November | 30 November 2024 |
| 1 December – 31 December | 31 December 2024 |
| Where a person does not have a license at the effective date of this Decision | (3) three months from the effective date of this Decision |
For resident juridical persons incorporated or recognized on or after the effective date, specific registration timelines are mandated. Entities incorporated under applicable legislation in the state, including Free Zone entities, must submit a tax registration application within three months from the date of incorporation, establishment, or recognition.
Similarly, for those incorporated under the applicable legislation of a foreign jurisdiction while being effectively managed and controlled within the state, the deadline for corporate tax registration application is within three months from the end of the financial year.
Non-Resident judicial Persons
For non-resident entities existing before the effective date, those with a permanent establishment in the state must submit their corporate tax registration application within nine months from the date of the permanent establishment’s existence. Alternatively, entities with a nexus in the state are obligated to submit the tax registration application within three months from the effective date of this decision.
In the case of non-resident entities established on or after the effective date, those with a permanent establishment in the state must complete their corporate tax registration application within six months from the date of the permanent establishment’s existence. Similarly, entities with a nexus in the state need to submit the tax registration application within three months from the date of establishing the nexus.
Natural Persons
For resident individuals involved in business activities exceeding the specified threshold (AED one million, subject to conditions specified in Cabinet Decision No. 49 of 2023) during the 2024 Gregorian calendar year or subsequent years, the imperative is to submit their Tax Registration application by the 31st of March of the subsequent Gregorian calendar year.
On the other hand, non-resident individuals engaged in business, surpassing the defined threshold (AED one million, subject to conditions specified in Cabinet Decision No. 49 of 2023) during the 2024 Gregorian calendar year or subsequent years, must promptly submit their Tax Registration application within three (3) months from the date of meeting the requirements of being subject to tax.
Consequences of Late Registration
Failure to complete the registration process within the stipulated timelines will lead to the imposition of administrative penalties, in accordance with Cabinet Decision No. 75 of 2023, as amended by Cabinet Decision 10 of 2024. A fine of AED 10,000 will be charged for registrations submitted after the due date
These penalties underscore the urgency and importance of timely compliance with the updated corporate tax regulations in the UAE.
TCA is at your service
TCA’s experienced team of tax specialists can provide you with expert guidance. Whether you require assistance with the registration process or have queries regarding Federal Tax Authority Decision No. 3 of 2024, Cabinet Decision No. 75 of 2023, or any other pertinent aspects of the UAE Corporate Tax Law, our dedicated team is readily available to provide comprehensive support.
Feel free to reach out to us to learn more about the deadline for corporate tax registration in UAE!!
