How to Register for Corporate Tax in the UAE: A Complete Guide for Businesses

The UAE has been making significant strides in its corporate tax landscape to align with global tax standards, and one of the most recent developments is the corporate tax registration requirement. As businesses across the UAE look to comply with new regulations, it's crucial to understand how to register for corporate tax in the UAE.

Whether you're a new startup, an established SME, or a multinational enterprise, understanding the process and requirements for corporate tax registration is vital for your business's long-term success. This blog will guide you through the steps, key considerations, and the benefits of corporate tax registration, ensuring that your business stays compliant with UAE tax laws.

What is Corporate Tax Registration in the UAE

Corporate tax registration is the process by which most businesses operating in the UAE must register with the Federal Tax Authority (FTA) to pay taxes on their corporate income.

→ Who Must Register? Under the UAE CT regime, most businesses are required to register for UAE Corporate Tax through the Emaratax platform (or Emaratax portal). Corporate tax registration is mandatory for entities whose taxable income exceeds the set threshold. This applies to juridical person entities, including those in free zones, unless specific exempt criteria are met. Natural persons conducting business may also qualify or be required to apply for a tax registration.

→ Initial Steps: The process involves creating an account, often using UAE Pass, and submitting a CT registration application. Once successfully registered, the entity receives a corporate tax registration number.

→ The Rate: The corporate tax rate in the UAE is generally $9\%$ on taxable income, though tax rates are structured with specific considerations, especially for Free Zone entities, keeping in mind the UAE introduced this as a direct tax to align with tax standards and avoid being labelled for harmful tax practices.

UAE Corporate Tax: A Complete Guide to Registration, Compliance, and Key Terminology

The UAE government has made significant strides in its fiscal landscape with the introduction of corporate tax in the UAE via Federal Decree-Law No. 47 of 2022 (and subsequent amendments). This shift to a direct tax on corporate income is designed to align with international tax standards and combat harmful tax practices, reinforcing the UAE's commitment to standards for tax transparency. Understanding the corporate tax registration process is vital for any business in the UAE.

What is a Tax Registration Number (TRN)

The Tax Registration Number (TRN) is a unique, official identification code issued by the relevant tax authority (such as the Federal Tax Authority in the UAE) when a business or individual successfully registers for a specific tax, like VAT or Corporate Tax. It serves as the entity's fundamental tax identity, is typically a fixed-length numeric code, and is mandatory for use on official documents like tax invoices, tax returns, and all official correspondence with the tax authority to ensure compliance, transparency, and accurate tracking of tax obligations.

Understanding UAE Corporate Tax: Registration vs. Deregistration

The foundation of this process is understanding the corporate tax law introduced by the UAE government. Corporate tax registration is mandatory for most businesses operating in the UAE, primarily for juridical person entities (including those in free zone areas unless exempt) whose taxable income exceeds the set threshold. This registration is done through the Emaratax portal after creating an account, often using UAE Pass, to obtain a corporate tax registration number. The applicable tax rate is generally $9\%$ on taxable income, though the introduction of federal corporate tax was to align with international standards.

Who Must Register?

Under the UAE CT regime, most businesses operating within the UAE are required to register for Corporate Tax through the Emirates Tax Authority (FTA) via the Emaratax platform/Emaratax portal.

→ Mandatory Registration: Entities operating a business or conducting business that are subject to corporate tax must register. This applies to juridical person entities, including those in free zone areas, unless they meet specific exempt criteria.

→ Registration Process: The corporate tax registration process involves creating an account, often using UAE Pass, and submitting a registration application on the Emaratax portal. You must provide details like your trade license, Emirate of operation, and potentially your TRN if you are already VAT registered.

→ Natural Persons: A natural person conducting business might also qualify or be required to register depending on the nature and scale of their activities.

Steps to Register for Corporate Tax in the UAE

The process of registering for corporate tax in the UAE is straightforward, but it requires careful attention to ensure all steps are followed correctly. Here’s a step-by-step guide to help you navigate the corporate tax registration process:

Step 1: Check Eligibility for Corporate Tax Registration

Before beginning the registration process, it’s essential to determine whether your business is subject to corporate tax. You should assess the following:

→ Your business’s annual revenue and profit.

→ Whether your business is involved in any taxable activities.

→ Your business structure (e.g., LLC, sole proprietorship, etc.).

→ Location: Businesses in certain free zones may qualify for tax exemptions, but they still need to comply with corporate tax rules.

Step 2: Prepare Necessary Documentation

Once you’ve determined that you need to register, gather the following documents required by the FTA for corporate tax registration:

→ Trade license (issued by the Department of Economic Development or free zone authority).

→ Company registration details: This includes the business’s legal status and shareholder information.

→ Financial statements: Profit and loss statements, balance sheets, and audited financials.

→ Contact information: Details of the business’s primary contacts and tax representative (if applicable).

Step 3: Submit Your Application to the FTA

Businesses must submit their corporate tax registration application online through the FTA's e-Services portal. The application process is straightforward and requires you to enter the relevant details of your business, including the financial information and nature of operations.

Step 4: Wait for Approval

After submitting your application, the FTA will review the documents and application. If everything is in order, they will approve the registration and issue a corporate tax registration number. This number will be used for filing tax returns and other regulatory activities.

Step 5: Stay Compliant with Ongoing Tax Obligations

Once your business is successfully registered for corporate tax, it is important to remain compliant with tax filing deadlines and payment requirements. This includes submitting annual tax returns, paying any due taxes, and maintaining proper financial records.

Common Corporate Tax Registration Mistakes 

→ Missing Registration Deadlines: Failing to file for tax registration by the stipulated due date, often leading to penalties.

→ Assuming Automatic Exemption: Believing the company is exempt from registration without officially applying for and receiving approval for exemption status.

→ Incorrect Business Structure: Choosing a legal entity that does not align with long-term tax and operational goals.

→ Inaccurate/Incomplete Information: Providing errors or missing details on the registration forms (e.g., wrong addresses, mismatched director details).

→ Ignoring Other Required Registrations: Overlooking simultaneous registrations for other necessary taxes like PAN, TAN, or GST/VAT, etc.

→ Improper Name Checks: Selecting a company name that is already registered or contains restricted/trademarked words.

Timing and Deadlines for Corporate Tax Registration

→ Registration Trigger: A company becomes legally obligated to register upon meeting specific criteria, such as incorporation date or achieving a revenue threshold.

→ Staggered Deadlines: For existing entities (often based on the jurisdiction, like the UAE example), registration deadlines are frequently staggered based on the date of the business license issuance.

→ New Entities: Recently formed companies usually have a fixed window, such as three months from the date of incorporation/establishment, to complete registration.

→ Penalty Risk: Missing the prescribed registration deadline, regardless of the reason, typically results in an administrative penalty.

→ Post-Registration: Once registered, the company must adhere to subsequent deadlines for filing annual returns and making estimated tax payments.

UAE Corporate Tax: From Initial Registration to Final Deregistration

The introduction of corporate tax in UAE via Federal Decree-Law marked a significant shift for all operating entities, including UAE branch offices and juridical person entities. Compliance begins with understanding and executing corporate tax registration correctly, and ends with proper corporate tax deregistration.

How Young & Right Can Help You with Registering for Corporate Tax in the UAE

Registering for corporate tax in the UAE is an essential step for businesses operating within the country. Since the introduction of corporate tax in the UAE in 2023, understanding the new tax requirements and complying with the Federal Tax Authority (FTA) is crucial for every business, including foreign entities, branches of international companies, and domestic firms.

At Young & Right, we provide comprehensive support to businesses looking to navigate the process of corporate tax registration. Our team is well-versed in the latest regulations and requirements set by the Federal Tax Authority and Abu Dhabi, ensuring that your business meets all necessary obligations

Conclusion

Registering for corporate tax in the UAE is an essential, non-negotiable step for most businesses. While the registration process via the Emaratax platform is designed to be straightforward, attention to detail in documentation and deadlines is paramount to avoid administrative penalties. Compliance with the UAE’s corporate tax regime is key to the business in the UAE's long-term success and commitment to international tax standards.