Corporate Tax Registration in the UAE

Corporate Tax Registration in the UAE

Corporate Tax Registration in the UAE is a mandatory requirement for businesses under Federal Decree-Law No. 47 of 2022. All taxable entities, including mainland companies, free zone entities, and certain exempt persons, must register with the Federal Tax Authority (FTA) to comply with corporate tax regulations and avoid penalties. Timely registration ensures businesses operate legally, gain access to government benefits, and maintain credibility in the market.

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What is Corporate Tax in the UAE?

Corporate tax, often known as corporate income tax or business profits tax, is a type of direct tax imposed on the net income generated by companies and business entities from their operations. Introduced in 2023 under Federal Decree-Law No. 47, this tax applies to companies holding a trade license, including mainland and free zone entities. The standard Corporate Tax rate is 9%, applicable only to taxable income exceeding AED 375,000, while income below this threshold is taxed at 0%. The tax is designed to support economic growth while ensuring compliance with international tax standards.

Who Needs to Register for Corporate Tax in the UAE?

Under the UAE Corporate Tax Law, all taxable persons are required to register for Corporate Tax and obtain a Tax Registration Number (TRN). Failure to comply within the deadline will result in penalties.

Natural Persons (Individuals)

Individuals conducting business under a commercial license must register if their annual revenue exceeds AED 1 million. This applies to:

• Freelancers & Sole Proprietors – Those operating under their personal name must register if revenue crosses AED 1 million.
• Even businesses qualifying for Small Business Relief (revenue below AED 3 million) must register first to avail of exemptions.

Legal Entities (Juridical Persons)

• Mainland businesses and free zone entities must register.
• Free zone businesses may qualify for tax incentives but must still complete registration.
• Foreign businesses with operations in the UAE are also subject to corporate tax registration.

Qualifying Public Benefit Entities (QPBE)

Certain charitable organisations and public interest entities, as defined under Cabinet Decision No. 37 of 2023, must also register for Corporate Tax. These include foundations and entities operating for societal benefit.

Corporate Tax Registration Exemptions

Certain entities in the UAE are exempt from Corporate Tax registration based on specific conditions set by the Federal Tax Authority (FTA):

• Automatically Exempt Entities: Government entities and government-controlled entities specified in a Cabinet Decision.
• Entities Exempt with Notification: Extractive and non-extractive natural resource businesses must notify the Ministry of Finance to qualify for exemption.
• Exempt by Cabinet Decision: Qualifying public benefit entities, pension funds, and investment funds may be exempt if they meet the specified criteria.
• Exempt with FTA Approval: Certain subsidiaries of exempt entities must apply for exemption.

Corporate Tax Rates

Requirements for Corporate Tax Registration

Procedure for Corporate Tax Registration