The UAE Ministry of Finance instituted Corporate Tax, a direct tax on the net income or profit of firms and businesses. This tax change is intended to help medium and small businesses by imposing an initial statutory tax rate of 9% on corporate profits greater than AED 375,000. All eligible Taxable Persons in the UAE must comply with the corporate tax legislation. This includes company tax registration, completing annual tax reports, and keeping accurate accounting records.
Furthermore, the establishment of corporation tax in the UAE aims to match worldwide tax norms. ebs chartered accountants provides the best company tax services and ensures fast corporate tax registration in the UAE to comply with the corporate tax framework. In this blog, we will talk about how to register for company tax.
Registration For Corporate Tax In UAE
According to the FTA’s Federal Degree Law 47, the corporate tax scheme requires every taxable person, including Free Zone Persons, to register and get a Registration Number. The Federal Tax Authority also requested that all Exempted Persons register for Corporate Tax.
Taxable Persons must file Corporate Tax returns for a Tax Period within nine months after the end of that period. This date is often used to pay any Corporate Taxes owed during the Tax Period for which the return is submitted.
In the instances excepted by the Minister, a Taxable Person must register for Corporate Tax with the Federal Tax Authority in a certain format and within a time frame determined by the Authority.
The Authority requires the Taxable Person or the Independent Partnership to register for Corporate Tax and get a Tax Registration Number. The Tax Authority should have a separate judgment for Corporate Tax Registration from the moment an individual becomes a Taxable Person. After registering for corporation tax, taxpayers must pay a standard rate of 9% on taxable income beyond AED 375,000, whereas taxable income up to AED 375,000 is tax-free.
How do you register for the UAE corporate tax?
The Federal Tax Authority has declared that corporate taxes will be pre-registered on the EmaraTax platform. It is an online gateway that allows taxpayers to manage all of their tax registrations, deregistrations, returns, refunds, and payments on one platform. VAT payments can also be made through EmaraTax’s user-friendly interface.
Experts can assist you in effortlessly creating an account or migrating your FTA account to EmaraTax. You may need to provide all of the paperwork required for business tax in the UAE in order to register effortlessly.
Procedure for Corporate Tax Registration in the UAE
- Determine tax liability
- Fix the entity type
- Plan the Business Activity
- Prepare required document
- Register for Corporate Tax
Need for Corporate Tax Registration in UAE
The UAE Ministry of Finance has developed a tax system and rules that may benefit enterprises that pay corporate Tax. If you are a business subject to corporate Tax, you can benefit from the following.
- Identifying fraudulent tax practices
- Ensuring compliance with tax laws and monitoring changes
- Adhering to global tax standards.
Corporate tax registration is also vital for minimizing the company’s after-tax revenue and returning it to shareholders. This affects not just individuals with direct shareholdings but also indirect shareholders such as investment funds and private pensions.
Corporate tax payments are more beneficial to business owners than paying higher income tax personally.
Who is exempt from UAE corporate tax?
The Federal Tax Authority has demanded that the Exempted Persons register for Corporate Tax. Furthermore, the exempted business is required to pay 0% corporation tax.
Certain categories are exempt from the UAE CT. Let’s look at some of them.
The employee’s remuneration will be unaffected by the UAE corporate tax, however, if the individual earns money through freelancing. Then, they will be assessed the corporation tax.
Dividends, capital gains, or any other type of income obtained through personal potential were generated by shares or comparable assets.
Investing in real estate is permissible in the UAE unless the investor lacks a company license.
Corporate Tax shall not be levied on foreign investors’ income from gains, dividends, royalties, and other comparable investment returns unless obtained through business activities.
Potential intra-group reorganizations or transactions will be unaffected by the corporate Tax.
Who should register for business taxes?
Every taxable person, even those in Free Zones, is obliged to register for Corporate Tax and obtain a registration number.
According to UAE corporation tax law, the following conditions must be met for tax registration:
- Registration at the FTA’s discretion.
- Mandatory registration.
If your business is subject to the corporation tax policy, you should file for corporate tax registration in the UAE. Once registered, you must obtain a Registration Number for the specified duration.
Best tax consultants assist businesses with the corporate tax registration process. The Federal Tax Authority recommends that some individuals, such as autonomous partnerships or exempt persons, register under the corporate tax policy and obtain a Tax registration number.
Conclusion
ebs chartered accountants employs the most experienced and trained tax consultants with a strong background in corporate tax registration. ebs has tax consultants who give high-quality assistance during the company tax registration process. ebs provides you with updates on corporate tax registration and return submission. Refrain from letting the complexity of the UAE’s corporate tax law hold you back.
With ebs as your trusted adviser, you can confidently negotiate the new tax landscape, focusing on growth and directing your company to a bright future. Contact us today for a free consultation and learn how we can help make your financial journey a success. We also offer accounting and bookkeeping services, auditing, due diligence audit services, and many others. So, get in touch with our specialists to discuss our services and contact us right away.
