How to Register for Corporate Tax in UAE?

The UAE's corporate tax regime is a significant move by the government to ensure fair taxation and create a robust business environment. Effective from June 1, 2023, the corporate tax registration has become a mandatory requirement for businesses operating within the country. Whether you're a mainland company, free zone entity, foreign company with a permanent establishment (PE), or even a freelancer, understanding how to navigate the corporate tax registration process is essential for compliance.

In this guide, we will break down the step-by-step process of registering for corporate tax in the UAE, detailing the essential attributes required, the types of businesses that need to register, and the post-registration compliance obligations. By the end of this article, you’ll have a clear understFaccanding of what’s needed to stay compliant and avoid penalties.

Key Attributes for Corporate Tax Registration

For a business to successfully register for corporate tax, certain key attributes and documents are required. Below are the essential attributes for the registration process:

1. Trade License Number & Expiry Date

The trade license is a crucial document that proves your business is legally allowed to operate within the UAE. You will need to provide the license number and expiry date when applying for corporate tax registration.

2. Entity Type

The entity type is an essential attribute. Businesses must specify whether they are:

• Mainland companies

• Free Zone entities

• Foreign branches

• Other legal structures

This classification determines whether you are subject to corporate tax and if you qualify for any exemptions.

3. Financial Year & Expected Taxable Income

Companies must declare their financial year and provide an estimate of their taxable income. The expected taxable income will help determine whether the business meets the registration threshold for corporate tax.

4. Business Activities & Sector

Businesses must provide a description of their core activities and the sector in which they operate. This can affect their eligibility for certain tax exemptions or reduced tax rates, depending on the nature of their work.

5. Business Address & Contact Information

The registered physical address of the business is required. This is typically the place where your company is legally registered to operate.

6. Authorized Signatory Information

The authorized signatory is the person who has the legal authority to sign documents on behalf of the business. This could be a CEO, Managing Director, or any individual authorized by the company’s board. The Emirates ID or passport details of the authorized signatory are required for verification.

7. Financial Statements

Detailed financial statements, such as income, expenses, and profit/loss, are required for tax reporting. These documents help the Federal Tax Authority (FTA) assess the taxable income.

8. Existing Tax Registration Status (VAT)

If the business is already VAT-registered, it must provide the Tax Registration Number (TRN). This links the business's VAT registration with its corporate tax registration.

9. Corporate Tax Registration Number (TRN)

The Tax Registration Number (TRN) is a unique identifier that is issued to a business once it completes its corporate tax registration.

10. Corporate Tax Registration Certificate

Once the registration is complete, businesses will receive a Corporate Tax Registration Certificate from the FTA, which serves as official proof of their tax compliance.

Who Needs to Register for Corporate Tax?

Now, let’s explore who exactly needs to register for corporate tax in the UAE.

1. Mainland Companies

All UAE mainland companies are required to register for corporate tax, regardless of their size or revenue. This includes businesses engaged in retail, manufacturing, services, and more.

2. Free Zone Entities

Even Free Zone companies are subject to corporate tax, though there are certain exemptions for specific Free Zones. If a Free Zone business does not meet the exemption criteria, it must register for corporate tax.

3. Foreign Companies with Permanent Establishments (PE)

Foreign companies operating in the UAE with a permanent establishment (PE) (such as a branch, office, or factory) are required to register for corporate tax if they generate income in the UAE.

4. Freelancers/Sole Proprietors

Freelancers or sole proprietors with annual revenue exceeding AED 1,000,000 are obligated to register for corporate tax.

5. Branches of Foreign Companies

Branches of foreign companies operating in the UAE mainland must also comply with the corporate tax registration process.

Exemptions

• Some government entities and public sector organizations are exempt from corporate tax registration.

• Certain Free Zone businesses, if they meet specific conditions, may also be exempt. However, they still need to apply for an exemption certificate from the FTA.

Step-by-Step Process for Corporate Tax Registration

Here’s the detailed step-by-step guide on how to register for corporate tax in the UAE.

Step 1: Collect Required Documents

Ensure that you have all the necessary documentation. This includes:

• Trade license and its expiry date.

• Financial statements.

• Information on authorized signatories.

• Contact details and business address.

Step 2: Prepare Financial Information

Prepare your financial records to determine the expected taxable income and ensure that they comply with the FTA’s reporting standards. Make sure your income statements, balance sheets, and profit/loss statements are accurate.

Step 3: Access the FTA Portal

Go to the Federal Tax Authority (FTA) website and log in to the tax registration portal. If your business is already registered for VAT, you will use the same FTA account to proceed with corporate tax registration.

Step 4: Complete the Online Registration Form

Fill out the corporate tax registration form. You will need to enter your business information, such as:

• Company name and trade license details.

• Entity type (Mainland, Free Zone, Foreign Branch, etc.).

• Expected taxable income and business activities.

Step 5: Submit Your Documents

Upload the required supporting documents, such as your trade license, financial statements, authorized signatory details, and VAT registration (if applicable).

Step 6: Pay Registration Fees

After submitting the registration form, businesses may be required to pay a registration fee. This fee is typically minimal, but it varies depending on the nature of your business.

Step 7: Wait for Approval

Once you’ve submitted the necessary information and documents, the FTA will review your application. If everything is in order, you will receive a Corporate Tax Registration Certificate.

Step 8: Receive TRN and Certificate

After approval, you will receive a Tax Registration Number (TRN), and your Corporate Tax Registration Certificate will be issued. Keep these documents safe, as you will need them for filing tax returns.

Post-Registration Compliance Requirements

After registering, businesses must comply with ongoing corporate tax obligations.

1. Maintain Financial Records

Businesses must maintain accurate financial records and ensure they are in line with local accounting standards. These records should be retained for five years and must be available for audit if requested by the FTA.

2. File Annual Tax Returns

Corporate tax returns must be filed annually, even if no taxable income is earned. The deadline for filing tax returns is nine months from the end of your financial year.

3. Transfer Pricing Compliance

If your business conducts transactions with related parties (e.g., subsidiaries), you must adhere to transfer pricing guidelines to ensure fair pricing for intra-group transactions.

4. Retain Supporting Documentation

Ensure you retain supporting documents, such as invoices, receipts, contracts, and financial statements to support your tax filings.

How Young & Right Can Help You

At Young & Right, we offer comprehensive corporate tax services to help businesses through the registration process and beyond. Our services include tax planning, reporting assistance, and ongoing compliance support to ensure your business stays on track. Let us take the burden of corporate tax compliance off your shoulders, so you can focus on growing your business.

Conclusion

Registering for corporate tax in the UAE is a vital step for businesses to ensure compliance with the country’s tax laws. Whether you are a mainland company, Free Zone entity, or a freelancer, it’s important to understand the process and complete the necessary steps to stay compliant. With the help of Young & Right, businesses can navigate this process efficiently and ensure that they meet all regulatory requirements.

For any questions or if you need professional assistance with corporate tax registration, feel free to reach out to Young & Right. We specialize in helping businesses comply with UAE tax laws while simplifying the complexities of tax registration and filing.