Since June 2023, the UAE has implemented corporate tax—a historic shift for a country known for being tax-free. If you own a business in the UAE, you must register for corporate tax to avoid penalties.
Here's everything you need to know.
Who Needs to Register?
Businesses That Must Register:
- All UAE Mainland companies (regardless of profit)
- Free Zone companies (to claim 0% tax status)
- Branches of foreign companies operating in the UAE
- Freelancers earning above AED 1 million/year
Businesses Exempt from Registration:
- Government entities
- Extractive businesses (oil, gas)
- Investment funds (if licensed)
- Public benefit organizations (charities)
Pro Tip: Even if your business earns below AED 375,000 (and pays 0% tax), you still need to register.
When to Register
Timeline:
- Existing businesses (before Dec 1, 2024): Register by May 31, 2025
- New businesses (after Dec 1, 2024): Register within 3 months of incorporation
- Foreign companies: Register within 6 months of establishing a taxable presence
Pro Tip: Don't wait until the deadline. Penalties for late registration start at AED 10,000.
How to Register: Step-by-Step
Step 1: Create an EmaraTax Account
Visit the Federal Tax Authority (FTA) portal: [https://eservices.tax.gov.ae](https://eservices.tax.gov.ae)
- Click "Register"
- Choose "Corporate Tax"
- Create a UAE Pass or login with existing credentials
Step 2: Enter Business Details
Provide:
- Trade license number
- Company name and address
- Business activity
- Shareholder information
- Financial year-end date
Step 3: Submit Supporting Documents
Upload:
- Trade license copy
- Memorandum of Association (MOA)
- Shareholder details
- Audited financial statements (if applicable)
Step 4: Receive Your Tax Registration Number (TRN)
Once approved, you'll receive a Tax Registration Number (TRN)—your unique corporate tax ID.
Timeline: Registration typically takes 1-2 weeks.
Tax Rates & Thresholds
| Taxable Income | Tax Rate |
|---|---|
| Up to AED 375,000 | 0% |
| Above AED 375,000 | 9% |
Example:
- Business A earns AED 300,000 → Pays AED 0
- Business B earns AED 500,000 → Pays 9% on AED 125,000 = AED 11,250
Free Zone Companies: Special Rules
Free Zone businesses can still enjoy 0% tax if they meet qualifying income criteria:
- ✅ Maintain adequate substance in the UAE
- ✅ Earn income from qualifying activities (e.g., international trade, consulting)
- ✅ Don't conduct business with UAE Mainland
Non-qualifying income (e.g., sales to Mainland UAE) is taxed at 9%.
Key Deadlines & Filing Requirements
Annual Tax Return:
- Must be filed within 9 months of your financial year-end
- Example: If your year ends Dec 31, 2025, file by Sep 30, 2026
Tax Payment:
- Due 9 months after year-end
- Can be paid in quarterly installments
Record Keeping:
- Maintain accounting records for 7 years
- Keep invoices, contracts, and financial statements
Penalties for Non-Compliance
| Violation | Penalty |
|---|---|
| Late registration | AED 10,000 |
| Late tax filing | AED 1,000 (first offense), increasing for repeat offenses |
| Late tax payment | 2% per month (up to 300% of unpaid tax) |
| Tax evasion | Up to 5x the evaded tax amount |
Pro Tip: Don't risk penalties. Register and file on time.
Common Mistakes to Avoid
Mistake 1: Thinking You're Exempt (You're Probably Not)
Even if your business earns below AED 375,000, you must register.
Mistake 2: Missing the Registration Deadline
Late registration = AED 10,000 penalty. Register early.
Mistake 3: Not Keeping Proper Records
The FTA can audit you at any time. Maintain 7 years of financial records.
Mistake 4: Assuming Free Zones Are Fully Tax-Free
Free Zones still need to register and prove qualifying income to pay 0%.
How to Minimize Your Tax Burden (Legally)
1. Keep Profits Below AED 375,000 (If Possible)
Reinvest profits into the business to stay below the threshold.
2. Set Up in a Free Zone
Free Zone companies can pay 0% tax on qualifying income.
3. Claim All Deductible Expenses
Reduce taxable income by claiming:
- Salaries and wages
- Rent and utilities
- Marketing and advertising
- Professional fees
4. Work with a Tax Advisor
A tax expert can help you structure your business to minimize tax legally.
How Core Bridge Can Help
At Core Bridge, we provide full corporate tax services:
- Tax registration (fast, hassle-free)
- Annual tax filing
- Tax planning (minimize your liability)
- Compliance support (avoid penalties)
Need help with tax registration? Contact us today.
The Bottom Line
Corporate tax is mandatory for all UAE businesses. Don't wait—register now to avoid AED 10,000 penalties and ensure compliance.
With the right strategy, you can legally minimize your tax and keep more profits in your business.
Get registered today.